Understanding Your Rights and Responsibilities

Business Scams

Scams are not only aimed at consumers – they are also targeted at businesses. Small businesses in particular are regularly in the sights of conmen.

If you run a business it may be worth spending some time familiarising yourself with the following scam examples – variations and new scams appear all the time, but by staying vigilant and ensuring you are careful when entering contracts, you could avoid becoming a victim….

Business Advertising Scams

Businesses regularly lose money to this scam and unfortunately it rears its ugly head regularly with many variations…

Your company is contacted by phone asking whether it wishes to place an advertisement or listing in a directory, calendar, diary etc. There is often some claim that this is for the benefit of a good cause such as a children’s charity, the police or the emergency services. If you say no or ask for further information only, you are still sent an invoice. If you ring to complain about this you are told that the advertisement company has a recording of you verbally agreeing to a contract. You are then likely to receive a series of harassing letters or phone calls threatening legal action unless you pay the ‘debt’. Some of the letters will supposedly be from solicitors or debt collectors.

For full information and advice on spotting and avoiding this type of scam, please read our Seven Signs of a Business Advertising Scam Guide.

Trading Standards suggest that if you have been targeted by one of these companies billing you for services you have not agreed to, you do not pay them any money and do not engage them in any telephone conversations.

Unsolicited Goods

Your business receives several items it has not ordered together with a large bill and subsequent threats of legal action. It is a criminal offence to attempt to invoice someone for goods they have not ordered and as no contract exists there is no way payment is legally enforceable. Often the company will attempt to get around this by ringing in the hope of speaking to a junior employee and will then state they are ringing to confirm the order, whatever is said they will claim that this constitutes a binding contract. Other times they will ring and imply that they are your regular supplier. The goods supplied are either of a higher cost or in far greater quantity to what you want.

Like the advertising directory scam this works on the basis that some companies will pay money on the threat of legal action whether or not there is any chance of its success.

Cheque Scams

A potential buyer contacts you agreeing to pay for whatever you are offering, however for some reason they have paid a cheque that is for more than the amount you require. They then ask you to pay them back the excess amount. After you pay them it will turn out that the cheque they gave you bounces, was forged or was stolen, leaving you out of pocket.

Internet Website Registration

Someone rings you out of the blue claiming that a third party is trying to register the name of your company as their website domain name. You have to pay them a sum of money quickly to stop this happening.  Whether or not the company actually performs the service, they will charge considerably more than what it would have cost you to register the name yourself. By creating a false sense of urgency they persuade those with limited knowledge of the internet to pay over the odds for a service they could have performed themselves. Needless to say the mysterious third party who was trying to register the domain name is never heard of again.

Business Rates Scams

You are approached by a salesman who claims that for a fee they will be able to get a reduction in your business rates. After the money is paid they are never heard from again and your rates stay the same.

Mandate Fraud

Your business is contacted by someone pretending to be one of your suppliers.  They say that they need to change some of the details of where payments are made to due to a change of bank account or some similar excuse.  The next time you make a payment to this supplier the payment will instead go to the scammer.


Payment Interception Scam

You have recently done some work for someone.  It is time for them to pay you but no payment is received.  You contact them for payment and they tell you that they have already paid you.  They show you an email supposedly from you requesting the payment but giving someone elses bank details.  A criminal has masqueraded as you in order to take the payment for themselves.  You can protect yourself by ensuring your IT is secure.

Further Help

Register your company with the telephone preference service for corporate organisations, which should cut down on unwanted calls.

You can read more about affecting businesses on the Action Fraud website, where you will find a handy list of common types of Corporate Fraud.

Businesses are also often targeted by variations of consumer scams, which you can read more about here. For advice on what to do if you think your business has been scammed, contact us.