Advice from the Business Compliance Team

A scam is a dishonest scheme designed to cheat and con your business out of money. We will explain how to avoid scams and how to report them.

Below are warnings and alerts on any new scam that we become aware of.

You can send your scam letters free to: Scamnesty - Business Compliance, Freepost (CV681), Coventry CV1 1BR or report any scams to Action Fraud, the UK's national fraud reporting centre on 0300 123 2040.

Your actions may help protect others from being targeted by scammers.

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Please visit the National Trading Standards eCrime Centre Types of Fraud page or Crime and fraud prevention for businesses in international trade a guide from HM Revenue & Customs.

Typical business scams

Business directory scams 

How it works - a form is received by post, e-mail, or fax appearing to offer a 'free' listing or asking if you wish to continue to be included in a hard copy or online business directory. You may be asked to check the details about your business, or be informed that an employee of yours has requested the form. You will be told to return the form even if you don't want to place an order
How they con you - In the small print it will state that by signing the form you are committing to an order. By signing and returning the form you are agreeing to pay for ongoing entries in the directory, costing hundreds of pounds per year. The 'publisher' may try to enforce this debt by sending threatening 'debt collection' letters.
Protect your business - Always carefully read the small print in any business directory offer to be clear about what you are being offered and how much it could cost you.

Office supply scams 

How it works - You will be called by someone wanting to discuss office supplies you might need on a regular basis such as stationery or print cartridges.
How they con you - The caller will mislead you or your employees into thinking that an order for office supplies has already been placed by either an existing or former employee and that you need to sign an order form to help with their record keeping. You will then be sent and invoiced for unwanted and often overpriced supplies. When you try to return the goods you will be told that you are not able to because you or a staff member signed the order form or agreed to the goods on the telephone.
Protect your business - Follow these tips:

• Don't agree to place an order over the telephone unless you are absolutely sure who you are dealing with.
• Encourage staff to make a note of any conversations they have with 'cold callers' or people claiming to have existing contracts with your business.
• Don't take the caller's word for it that you have placed an order previously or that someone in your organisation has agreed to take an order. 
• Insist on seeing written details and a copy of the supplier's full terms and conditions before placing an order.

Domain name scams

How it works - Registration: You will be cold called by a person claiming to be a domain name registration agent. The agent will inform you that a third party is interested in, or just about to purchase an internet domain name similar to that of your business.
Renewal: You receive a letter that looks like a renewal notice for your domain name.
How they con you - Registration: The caller will tell you that they want to give you first refusal on the domain name but you must act quickly if you wish to secure the name. Sometimes you may only be given minutes to accept the offer. The agent will pressure you into agreeing to pay an excessive fee for a domain name. In reality no interested third party exists.
Renewal: Although the letter talks about renewal of your current domain name it will be from a different company to the one you have previously registered with.
Protect your business - If you have doubts about the reliability of a domain name offer you should contact your usual service provider or domain name registration agent.

Publishing and advertising scam

Be on your guard if you are approached by unknown companies claiming to sell advertising. Typically, the publisher claims that the business has agreed to buy advertising space in their publication, such as a magazine, wall chart, diary or yearbook which is usually associated with a 'good cause', such as the emergency or health services, crime prevention or drug awareness projects. If you receive a demand for payment for advertising which you have not agreed to, you do not have to pay.

Business rates reduction scam

Be on your guard if approached by firms offering business rate reduction services who will charge large fees promising to get business rates reduced on appeal.

Coventry Business Compliance receive complaints about rogue firms who deliberately target businesses whose rates have increased. They charge fees of around £500 just to make an appeal against the revaluation. Our advice: say no to firms who cold call offering to do rating appeals. Their contracts are carefully worded and don't match up to verbal promises. Once signed you will have no automatic right to cancel and you may also find that you are bound to make further payments if the appeal is successful, but remember, the reduction may be less than the fees you have paid. Get advice from the local Valuation Office before you agree to anything. Details can also found on the valuation office website at http://www.voa.gov.uk/. But remember, if you appeal your rates could go up as well as down.

Protect your business from being scammed 

Some simple tips to follow to reduce the risk of falling for business scams:

• Be on your guard.  If it seems 'too good to be true' it probably is!  
• Limit the number of staff allowed to approve purchases. Make sure all other staff know that they can't discuss orders or payments.
• Never agree to anything in a hurry. Remember it's possible to make a legally binding contract over the phone but very hard to prove what was said and agreed. Generally, it's one person's word against another's.
• Do some research on the company and the goods or services being offered. 
• Read the small print thoroughly before signing paperwork so you know what you are agreeing to and how much it will cost. 
• Keep copies of all paperwork, proof of posting and all other correspondence.

If you are approached or have concerns about anything that you think could be a scam, please contact Business Compliance.