We’ve all seen the breaking news stories about the massive data breaches involving big-box retailers such as Target and Michaels. These incidents left consumers in fear, but the companies were able to absorb the losses.
Unfortunately, small businesses don’t always have the luxury of recouping massive financial losses after a breach. In severe cases, they’re forced to shut down for good.
If you’re a small business owner, here are some scams that could hurt your business:
1. Charitable Causes
Problem: Donating to a charitable cause is a great way to pay it forward while receiving positive exposure for your company. Unfortunately, there are fraudsters who will take advantage of your generosity.
Spotting such tricksters can be difficult, according to the Federal Trade Commission:
Of course, crooks cover their tracks by picking names confusingly similar to reputable charities, so it’s hard for businesses to find out they’ve been had.
Once you hand over the check, these fraudsters are gone with the wind.
Solution: Before making a monetary contribution, take a look at this document from the FTC, which includes tips for verifying a charity’s legitimacy, and an extensive list of red flags that should raise your level of suspicion.
2. Business Directories
Problem: Some companies may offer to list your company in their business directory. Generally, this is a good thing. After all, the more promotion for your business, the better.
However, not all solicitations for advertisements are created equal, according to the FTC. In some cases, the fraudsters may demand pay later for your listing. In other cases, they will demand you pay for a directory that does not exist.
Either way, you may be hounded for hundreds of dollars and threatened with legal action if you do not pay.
Solution: Educate yourself and your staff to be on the lookout for this type of scam. Even better, designate a specific representative to handle all transactions of this sort. Never agree to any form of advertising arrangement via telephone until the fine print is scrutinized and the validity of the offer is confirmed.
3. Phishing Emails
Problem: You receive an email with an important subject line. Or perhaps you get a note from what seems to be a familiar source. Either way, you open it and start reading.
Depending on the message, you may click on a link in the body of the email. Within seconds, viruses flood your computer, capturing account information, credit and debit card numbers, Social Security numbers, and other sensitive data. This is known as phishing and poses a major threat to your organization.
Solution: Carefully inspect email messages to ensure they are from a reputable source. Grammatical errors and suspect images could indicate otherwise.
Also, confirm your anti-virus software is up to date. Making sure that you receive security alerts can help you prevent unwanted viruses from being downloaded onto your computer.
4. Office Supplies
Problem: Sometimes, supplies show up at the office door that you never ordered. In other cases, a delivery person may present you with a package that seems legitimate, but which does not actually contain the promised product. Either way, unsuspecting employees may simply pay the bill.
Solution: As with preventing directory scams, it is important to educate your staff about when to accept a delivery. Again, it is best to designate one employee who clearly understands what you have and have not ordered, and who can be on the lookout for scams.
Problem: In this scam, a customer sends the business a check considerably larger than the purchase amount and requests a prompt refund for the difference.
However, in many cases the check eventually bounces — but not until the business has already refunded the partial amount.
Solution: The best way to avoid this scam is simply to refuse to accept an overpayment.
This post originally appeared on Money Talks News.
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