US|GCP™ Guide To Scams and Your Small Business
If you own a small business or are part of a non-profit organization, you spend a lot of time and effort making sure the organization works well. But when scammers go after your organization, it can hurt your reputation and your bottom line. Your best protection? Learn the signs of scams that target businesses. Then tell your employees and colleagues what to look for so they can avoid scams.
Tactics Scammers’ Use
- Scammers pretend to be someone you trust.
They make themselves seem believable by pretending to be connected with a company you know or a government agency.
- Scammers create a sense of urgency.
They rush you into making a quick decision before you look into it.
- Scammers use intimidation and fear.
They tell you that something terrible is about to happen to get you to send a payment before you have a chance to check out their claims.
- Scammers use untraceable payment methods.
They often want payment through wire transfers, reloadable cards, or gift cards that are nearly impossible to reverse or track.
How Can You Protect Your Business?
- Don’t believe your caller ID. Imposters often fake caller ID information so you’ll be more likely to believe them when they claim to be a government agency or a vendor you trust.
- Remember that email addresses and websites that look legitimate are easy for scammers to fake. Stop and think about whether it could be a scam before you click. Scammers even can hack into the social media accounts of people you trust and send you messages that appear to be from them. Don’t open attachments or download files from unexpected emails; they may have viruses that can harm your computer.
- Secure your organization’s files, passwords, and financial information. For more information about protecting your small business or non-profit organization’s computer system.
Know Who You’re Dealing With
- Before doing business with a new company, search the company’s name online with the term “scam” or “complaint.” Read what others are saying about that company.
- When it comes to products and services for your business, ask for recommendations from other business owners in your community. Positive word-of-mouth from trustworthy people is more reliable than any sales pitch.
- Don’t pay for “free” information. But specialized knowledge is available for fair prices.
Train Your Employees
- Your best defense is an informed workforce. Explain to your staff how scams happen and share this guide with them.
- Encourage people to talk with their coworkers if they spot a scam. Scammers often target multiple people in an organization, so an alert from one employee about a scam can help prevent others from being deceived.
- Train employees not to send passwords or sensitive information by email, even if the email seems to come from a manager. Then stick with the program — don’t ever ask for sensitive data from employees by email.
Verify Invoices and Payments
- Check all invoices closely. Never pay unless you know the bill is for items that were actually ordered and delivered. Tell your staff to do the same.
- Make sure procedures are clear for approving invoices or expenditures. To reduce the risk of a costly mistake, limit the number of people who are authorized to place orders and pay invoices. Review your procedures to make sure major spending can’t be triggered by an unexpected call, email, or invoice.
- Pay attention to how someone asks you to pay. Tell your staff to do the same. If you are asked to pay with a wire transfer, reloadable card, or gift card, you can bet it’s a scam.
Learn More About How US|GCP Can Help Your Business Prevent Socially Engineers Cybercrime
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Common Scams That Target Small Business
Social Engineering Scams
This is one of the more insidious types of scams. It comes in many different types and can include other types such as BEC, but your employees can also be vulnerable to a type of scam known as a romance scam and this allows the scammer to heavily manipulate the victim into doing things they never would have thought of doing. Scammers can manipulate your employees into embezzling, stealing company secrets, compromising other employees, and much worse. After the scam, they are left traumatized and suffering. Helping employees understand their interpersonal risks online is essential to avoid these scams.
Credit Card Processing and Equipment Leasing Scams
Scammers know that small businesses are looking for ways to reduce costs. Some deceptively promise lower rates for processing credit card transactions or better deals on equipment leasing. These scammers resort to fine print, half-truths, and flat-out lies to get a business owner’s signature on a contract. Some unscrupulous sales agents ask business owners to sign documents that still have key terms left blank. Don’t do it. Others have been known to change terms after the fact. If a sales person refuses to give you copies of all documents right then and there — or tries to put you off with a promise to send them later — that could be a sign that you’re dealing with a scammer.
Government Agency Imposter Scams
Scammers impersonate government agents, threatening to suspend business licenses, impose fines, or even take legal action if you don’t pay taxes, renew government licenses or registrations, or other fees. Some businesses have been scared into buying workplace compliance posters that are available for free from the U.S. Department of Labor. Others have been tricked into paying to receive nonexistent business grants from fake government programs. Businesses have received letters, often claiming to be from the U.S. Patent and Trademark Office, warning that they’ll lose their trademarks if they don’t pay a fee immediately, or saying that they owe money for additional registration services.
Business Email Compromise
Cyber scammers can trick employees into giving up confidential or sensitive information, such as passwords or bank information. It often starts with a phishing email, social media contact, or a call that seems to come from a trusted source, such as a supervisor or other senior employee, but creates urgency or fear. Scammers tell employees to wire money or provide access to sensitive company information. Other emails may look like routine password update requests or other automated messages but are actually attempts to steal your information.
Tech Support Scams
Tech support scams start with a call or an alarming pop-up message pretending to be from a well-known company, telling you there is a problem with your computer security. Their goal is to get your money, access to your computer, or both. They may ask you to pay them to fix a problem you don’t really have, or enroll your business in a nonexistent or useless computer maintenance program. They may even access sensitive data like passwords, customer records, or credit card information.
Business Promotion and Coaching Scams
Some scammers sell bogus business coaching and internet promotion services. Using fake testimonials, videos, seminar presentations, and telemarketing calls, the scammers falsely promise amazing results and exclusive market research for people who pay their fees. They also may lure you in with low initial costs, only to ask for thousands of dollars later. In reality, the scammers leave budding entrepreneurs without the help they sought and with thousands of dollars of debt.
Utility Company Imposter Scams
Scammers pretend to call from a gas, electric, or water company saying your service is about to be interrupted. They want to scare you into believing a late bill must be paid immediately, often with a wire transfer or a reloadable card or gift card. Their timing is often carefully planned to create the greatest urgency — like just before the dinner rush in a restaurant.
Changing Online Reviews
Some scammers claim they can replace negative reviews of your product or service, or boost your scores on ratings sites. However, posting fake reviews is illegal. FTC guidelines say endorsements — including reviews — must reflect the honest opinions and experiences of the endorser.
Directory Listing and Advertising Scams
Con artists try to fool you into paying for nonexistent advertising or a listing in a nonexistent directory. They often pretend to be from the Yellow Pages. They may ask you to provide contact information for a “free” listing or say the call is simply to confirm your information for an existing order. Later, you’ll get a big bill, and the scammers may use details or even a recording of the earlier call to pressure you to pay.
Unordered Office Products
Someone calls to confirm an existing order of office supplies or other merchandise, verify an address, or offer a free catalog or sample. If you say yes, then comes the surprise — unordered merchandise arrives at your doorstep, followed by high-pressure demands to pay for it. If you don’t pay, the scammer may even play back a tape of the earlier call as “proof” that the order was placed. Keep in mind that if you receive merchandise you didn’t order, you have a legal right to keep it for free.
Fake Check Scams
Fake check scams happen when a scammer overpays with a check and asks you to wire the extra money to a third party. Scammers always have a good story to explain the overpayment — they’re stuck out of the country, they need you to cover taxes or fees, you’ll need to buy supplies, or something else. By the time the bank discovers you’ve deposited a bad check, the scammer already has the money you sent them, and you’re stuck repaying the bank. This can happen even after the funds are made available in your account and the bank has told you the check has “cleared.
Scammers create phony invoices that look like they’re for products or services your business uses — maybe office or cleaning supplies or domain name registrations. Scammers hope the person who pays your bills will assume the invoices are for things the company actually ordered. Scammers know that when the invoice is for something critical, like keeping your website up and running, you may pay first and ask questions later. Except it’s all fake, and if you pay, your money may be gone.
What Do You Do Next?
Learn More About Scams
- There is a vast amount of information published about scams of all types, and your awareness of these is vital.
- Recognize that like in most areas, you are an expert in your business, but you are not an expert in scams and socially engineering cybercrime.
- Remember that an IT Security company is also not an expert in Socially Engineered scams – they understand routers and networks, not how social engineering compromises your employees and bypasses your IT security – regardless of what they market.
- The Rabit Hole of Social Engineering a deeper than you think and your organization is already vulnerable and corrective measures should be taken now.
- Remember: Your best defense is an informed workforce – Talk to your staff about how scams happen – hire an expert in the field to train your team and support them through future incidents.
- Remember: Social engineering scam happen to your employees, families, and friends also, not just your company. Your training should encompass the complete range of your human capital always.
Report All Scams
- If you spot a scam, report it – it is not only a duty, but it just may help prevent the next socially engineered scammer attack on your business.
- Do not just mark scam emails as junk or spam, they need to be actively reported to help alert others.
- Depending on the scam follow this guideline:
- If There Is No Monetary Loss:
- Report to the Federal Trade Commission at www.FTC.gov/Complaint
- Report the email addresses and phone numbers on www.Anyscam.com
- If There Is Monetary Losses:
- Report the crime immediately to your local FBI Field Office
- Report to your Local Police (you will need this for your insurance and taxes)
- Report the email addresses and phone numbers on www.Anyscam.com
- Alert your state Attorney General. You can find contact information at www.NAAG.org
- Additionally report the incident online at the FBI’s online reporting portal www.IC3.gov (these are information repositories.
- If There Is No Monetary Loss:
Your Report Can Help Stop A Scam!
Remember Scams Are Everyone’s Business
Any incident that happens is because your people were not sufficiently well trained. Compare your loss with the cost of proper training, testing, and support.