How COVID-19 poses new fraud threats to vulnerable businesses
Scam artists know how anxious business owners are during the Fake suppliers. Whether Defective goods. Even if Payment fraud. Online Google scam. Fake Unfortunately, these
current coronavirus (COVID-19) crisis. They know that as you struggle to meet
customer demands, pay employees and stay solvent, you’re more likely to drop
your guard and fall for a fraud scheme. The last thing your business needs
right now is to suffer additional financial losses. So keep an eye out for the
following scams:
you’re a manufacturer seeking raw materials or a grocer desperate to keep
shelves stocked, you may have trouble getting your usual supplies. If a regular
supplier is temporarily — or permanently — shut down, be careful about doing
business with unknown vendors. Many authentic-looking websites are, in fact,
fronts for criminal operations, and if you place an order with them, you may
never receive the goods. Also be wary of cold callers promising to source
hard-to-get items. If it sounds too good to be true, it probably is.
you do receive your supply order, there’s a chance its contents will be
defective. In early March, an international team of law-enforcement agents
arrested 121 criminals around the world who were selling counterfeit surgical
masks, hand sanitizer and other in-demand products. Depending on your business,
buying defective goods could be an expensive mistake — or a public health
emergency.
payment fraud was already growing aggressively. But COVID-19 is expected to
throw fuel on the fire as more people turn to home services apps, such as those
for food delivery and online learning. Consumers usually don’t pay when their
stolen credit cards are used to make purchases. But businesses generally do.
You’re likely to be held responsible for fraudulent transactions, as well as
possible chargeback fees. So be vigilant about maintaining IT security.
Retailers might consider adding an Address Verification Service, which
confirms a cardholder’s billing address with the card company.
robocalls claiming to come from Google have circulated for several years. Now
there’s a COVID-19 twist. The recorded message tells businesses “affected by
the coronavirus” that they need to ensure their Google listing is correct so
that customers can locate them during the pandemic. If you speak to someone, he
or she may ask for payment to list your business or try to gain confidential
information. Know that Google never makes unsolicited sales calls. If someone
tries to convince you otherwise, hang up.
schemes represent only the tip of the iceberg. For the latest on
COVID-19-related fraud, visit the Federal Trade Commission’s “Business Center”
at ftc.gov/tips-advice/business-center.
Or contact us.