Directory Scams Are Costing Small Business Millions Of Dollars

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Directory Scams Are Costing Small Businesses Millions


Article Summary:


Are you frustrated by charges for directory listings you never submitted or purchase orders for supplies you didn’t request? You're not alone. The Federal Trade Commission (FTC), the nation's consumer protection agency, reports that businesses, churches, and charitable organizations are losing millions yearly to deceptive schemes targeting these unsuspecting groups.

Article Body:


Many small businesses are unwitting victims of scams involving false directory listings. Con artists trick employees into providing information under the guise of verifying or renewing a company's listing. They then send urgent invoices for unordered, often useless directories, creating confusion and relying on organizations to pay to stop the harassment.

If you refuse to pay, these scammers may use high-pressure tactics, such as threatening legal action. They might offer a fake discount or request payment for the listing while allowing you to return the directory at your expense. Paying may expose you to more invoicing from other scammers who have acquired your details.

To protect yourself, research before subscribing to any directory. Contact the Better Business Bureau or the publisher to verify legitimacy. Ask for a prior edition and documentation on distribution, and consult advertisers from previous editions about their experiences. Tighten your purchasing procedures and inform your staff about these scams.

Precautions and Training:


1. Educate Your Staff: Train employees on how to handle telemarketers. Encourage them to refuse decision-making on orders, directing inquiries to the appropriate personnel.

2. Establish Controls: Set up separate teams for ordering and billing to ensure a solid check-and-balance system. Be wary of unsolicited calls, and always demand proper documentation.

3. Verify Deliveries: Ensure that received merchandise matches the shipper’s bill and your purchase order. Refuse any mismatched items and notify your accounts payable department only if everything aligns.

Additional Tips:


- Purchase Orders: Use electronic or written forms for all service orders. Include the supplier's name and a P.O. number on invoices. Communicate purchase copies to accounts payable.
- Know Your Rights: If you receive unordered goods, treat them as gifts?"legally, you are not obligated to pay or return them. Companies cannot demand payment or returns for items you didn't order.
- Telemarketing Sales Rule: Familiarize yourself with FTC regulations on phone sales for non-durable goods like office supplies. Telemarketers must disclose that it’s a sales call, who they are, the costs, and any restrictions up front.

By staying informed and vigilant, you can protect your organization from these costly scams.

You can find the original non-AI version of this article here: Directory Scams Are Costing Small Business Millions Of Dollars.

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