More Small Business Owners Being Targeted for Fraud

More Small Business Owners Being Targeted for Fraud

Small business owners generally have a lot on their plate, whether it’s focusing on expanding their companies or figuring out which small business insurance policies are best for their futures. However, because of this, it might not always be easy for them to spot potential scams that can end up costing them significantly.

One such type of fraudulent activity which has recently been spotted in Milwaukee involves criminals posing as people working for the Yellow Pages who try to sell ads to small business owners for large sums of money in exchange for a large amount of exposure that they simply will not receive, according to a report from the city’s Fox affiliate, WITI.

What has been happening to many of the city’s small businesses is that fraudsters have been contacting them using the familiar “Yellow Pages” name and logo. Interestingly, this is actually somewhat legal because neither the name nor logo are copyrighted or trademarked.

But where the scam veers into illegality is that the mailings they send to local small businesses – either unsolicited or after bogus phone calls establishing interest – ask owners to fill out paperwork, ostensibly to either begin advertising in the newspaper or renew existing ads they might have, the report said. They have no authorization to do this, but nonetheless send companies invoices for hundreds of dollars or more, and some have actually followed through on these payments.

“[S]hortly after that they would receive an invoice for $499, $599 or $1,299 for an online listing in the Yellow Pages,” U.S. Postal Inspector Christopher Cizin told the television station.

Those that do not, however, have faced a different problem: harassment, the report said. Companies that failed to pay the invoices – sometimes once they realized they’d been duped – began receiving threatening phone calls and letters from the fraudsters, stating that their outstanding (fraudulent) balances would be sent to collections agencies or lawyers. However, this, too, was just an attempt by the criminals to bilk owners out of their money through bullying, because typically, the lawyers that contacted the companies were simply other fraudsters working with the people who originally contacted the company.

Avoiding these and other problems
For this reason, it’s always recommended that small business owners do what they can to request more information from anyone who solicits them for any reason, as legitimate businesses will be happy to provide it, and fraudsters typically will not, the report said.

In the case of these phony Yellow Pages ads, owners should try to familiarize themselves with how and when these directories are published in their areas. It should, however, be noted once again that because of the copyright issues at hand, many of these fraud attempts may not always be easy to discern, and therefore extra caution is needed.

Of course, small business owners typically face a number of security concerns that larger companies do not simply because they typically do not have the infrastructure to handle them. For this reason, it’s vital that these people take the time to carefully assess their needs, particularly when they are in charge of protecting sensitive data for clients and customers. This will potentially help them to avoid the problems that can come from data breaches – regardless of whether they’re the result of hacking attacks or simple exposure due to human error, such as a misplaced hard drive or erroneous email – which can run into tens of thousands of dollars or more to remediate, and significantly endanger businesses’ bottom lines.

Taking on tech insurance policies in particular can help to shield companies from these issues.