Cheque overpayment and other scams

ActionFraud is warning businesses to be on their guard for a new cheque overpayment scam. The target business receives a letter with an enclosed cheque in settlement of an invoice. The scammer phones up 24 hours after the cheque’s receipt and claims that he has made a mistake and politely requests that the excess amount be refunded via an online banking transfer. They do this in the hope that the recipient will send the monies before they discover that the cheque is fake. Experienced businessmen and women are unlikely to fall for this little trick, but inexperienced members of staff could comply in an attempt to appear helpful.

So, if your business accepts cheques, it makes sense to issue a directive to your accountant or bookkeeper to check any cheque received against outstanding invoices, rather than paying them into the bank and then reconciling your accounts later. Also, where a customer requests a refund (for whatever reason) it should always require an owner or director’s approval.

Unfortunately, this is not the only scam doing the rounds at the moment and you should also be on your guard against the following:-

Double tip scam

Whether you’re entertaining business clients or just having a meal with your partner, some restaurants are trying to double their tips. Sometimes a discretionary service charge of anything up to 15% is added to bills. If you’re not eagle-eyed you will miss it. This is what the restaurant is hoping for and so you’ll leave an additional tip. They achieve this by giving you the hand-held terminal, having already keyed in the amount of your bill, plus the service charge. You won’t be aware of this as the machine simply asks “Add a gratuity? Press yes or no”. If you say “yes”, you’re tipping twice!

Most restaurants are entirely honest but always check your bill carefully. If a tip has already been added, don’t pay it again and never authorise a payment if you didn’t see the amount put in. Also never pay at the table to avoid credit and debit cards being taken out of your sight.

Bogus Taxman scam

HMRC has recently issued a warning about fraudsters trying to tap into your bank account. In the past these scams have involved sending e-mails that purport to come from the Revenue or VAT and ask you to provide your bank details, whereupon the con artists try to clear out your account. Whilst they still try this, they are also using a new tactic. The warning comes amid a recent surge in the number of tax scam ‘phishing’ e-mails reported to HMRC. In the last three months, HMRC has shut down more than 180 websites that were responsible for sending out the fake tax rebate e-mails.

This time the conmen are ‘phoning taxpayers posing as HMRC officers calling about a tax refund. Again, they’re after your bank details. Chris Hopson, Director of Customer Contact at HMRC, said, “We only ever contact customers who are due a tax refund in writing by post. We never use telephone calls, e-mails or external companies in these circumstances.” He went on to say what action you should take if you receive a bogus call:-

1. Check the advice published at www.hmrc.gov.uk/security/index.htm to see if the e-mail you have received is listed.
2. Forward suspicious e-mails to HMRC at [email protected] and then delete it from the computer/mail account.
3. Do not click on websites, links contained in suspicious e-mails or open attachments.
4. If you suspect that you have been the victim of an e-mail scam: report the matter to your bank/card issuer as soon as possible. If in doubt, check with HMRC at www.hmrc.gov.uk/security/fraud-attempts.htm

Business directory scam

The Office of Fair Trading is warning businesses to be vigilant following a rise in business directory scams.  This type of scam is not new, but it’s on the increase. First a letter arrives from a Company claiming to run a business directory or guide. It will say something like: “We’re currently updating our “Recommended Business Guide”. By filling in this form and returning it to us in the pre-paid envelope your details will be included in the next edition and available to thousands of new customers. We’ll also send you a free copy of the directory.”

They will send you a form containing some of the recipient’s contact information. It then invites you to verify this as correct or update anything that is wrong or out of date. They obtain this information by phone; but rather than speak to a business owner or company director, they’ll target unwitting staff, particularly the younger ones who may not know such frauds exist. Sometimes they’ll simply ask for your personal information so they can write direct to you. Then, a helpful employee readily hands it over – thinking they’re just doing their job. It’s this information that ends up on the “update” forms. The letters are convincing, but once the form is returned the problems start. A hefty invoice – usually in another currency – for a subscription to the directory will arrive. When this is challenged the recipient is referred to the small print at the bottom of the form. This states something along the following lines:

“By signing this form you are placing an order to be included in the directory for five years. This is at the cost of 500 Euros per annum. After ten days this order cannot be cancelled. Full payment for this order will be due on the issue of our invoice.”

If the invoice is ignored, there may be further threats to damage the company’s credit rating or to send in the bailiffs. So what can you do:-

1. Tell staff that they must not volunteer any more than basic company information, e.g. address, and certainly not your personal details, to any unsolicited callers. If requested, they should take details and pass them on to you.
2. Register your company with the Telephone Preference Service. It’s free and once you do so it’s illegal for companies to contact you with unsolicited calls. This won’t stop determined scammers but it will it’s likely to deter most of them.

Rogue trader scams

It’s easy to get ripped off by a rogue trader. To combat the problem a government-endorsed scheme, TrustMark, has been set up. It lists around 250,000 tradesmen and businesses that have all been independently verified through regular inspections, checks on their trading record and financial status. They must also carry insurance. So whether you need a security engineer for your company premises or a builder for your home, you can use the search facility to locate one.

Training scams

There’s a new scam your business needs to watch out for, in the form of bogus training. Either where the training doesn’t exist at all, the provider just takes your money and vanishes; or where the course goes ahead but is of poor quality or the qualification isn’t recognised.

According to the Office of Fair Trading, there’s been a steep rise in the number of bogus courses. They cover a wide variety of areas, but the one with the highest number on offer is IT. Some fraudulent providers go to great lengths to convince you that they’re real. They do this by setting up websites which imitate those run by organisations offering genuine training. So if you are thinking of sending a staff member for some extra training, what should you do:-

1. If the course claims to offer a qualification, e.g. City & Guilds or NVQ, check they are accredited with the relevant examining body.
2. Look at the provider’s contact details and make sure that they have a full address and a landline telephone number that works. A PO Box address or mobile phone number is suspicious.
3. Request sample course materials. If they won’t let you have these, ask yourself why.
4. Ask them for references from other companies that have used their training. A reputable provider will always let you have this and you can make your own enquiries.
5. Legitimate providers usually offer a cooling-off period and allow you to pay in installments. This should be spelt out in their terms and conditions. If it’s not, ask them to put their payment and refund policies in writing.
6. Don’t part with any personal details, e.g. bank account information, until you know a course is legitimate. Some bogus training is simply a front to obtain details to commit identity fraud

As the scammers’ main objective is to get their hands on your money as quickly as possible, they’ll usually insist that the full course fees are paid up-front. You do have legal rights to cancel training and courses sold over the phone or Internet and these are covered by the Consumer Protection (Distance Selling) Regulations 2000. These give you a seven-day cooling-off period and during this time you can cancel for any reason.

Of course these are not the only scams going round and if you have experience of one please forward to me via our Contact Page on our website or email me and I’ll be pleased to share it with other readers of my Blog