Business scams - examples

Further information for businesses about scams

Support publishing and advertising

In this scam, a business is offered advertising space in a publication associated with a worthy cause.

The causes could include:

  • charities
  • crime prevention
  • drug awareness
  • hospitals or emergency service staff

The type of publications may include:

  • booklets
  • yearbooks
  • diaries
  • calendars
  • magazines

The publishers sometimes make misleading claims about their connections with these causes, and some of the causes may also have been mislead into becoming associated with them.

There is no guarantee that the publication will be printed or find a relevant audience. Any charity donation made may only be a very small proportion of the overall revenue.

Business directories

This scam relates to a business being listed in published directories, electronic directories or on websites. You may get ‘official-looking’ documents from trade directories asking for details such as your website, email or other contact details. They can look like adverts for free listings, but small print could commit you to pay hundreds of pounds for an entry. It is worthwhile considering if you were a customer would you be more likely to turn to this directory or an established search engine.

Unsolicited goods

Sometimes scammers will send unsolicited goods to a business, and then after a period of time they will then send an invoice.  The goods are often business consumables and tend to be of poor quality and over priced. The type of goods can include stationery, generic printer cartridges and cleaning products.

One variation of this scam is where a rogue trader will supply legitimate supplies, but then later says a mistake has been made and there are still some items to be supplied.  A business may agree to the offer of the remaining goods and may also be given some vouchers or another item to make up for the supposed mistake. The goods do not arrive with an invoice and the business may use the goods. They then later receive an invoice for a huge amount, and even if they dispute the invoice are told to pay.

Bogus invoice scam

One of the simplest of scams is that without any previous contact, bogus invoices could be sent to a business. They may be for goods that do not exist, fictitious services or adverts in publications that do not exist. Although this type of scam is very hit-and-miss, some victims pay the invoice without question.

Leasing scams

This type of scam will often involve a personal visit from a sales agent, and the target business is persuaded to sign up to a contract for a combination of goods and services in connection with a lease on expensive equipment. 

The type of goods may include:

  • telecommunications equipment
  • computer equipment
  • photocopiers

The services may relate to the usage and/or maintenance of the equipment.

Initial prices appear to be very attractive, but the victim is mislead as to the extent of the commitment they are signing up to. They can often end up being tied to long-term lease agreements which can be very expensive to escape, and end up with poor quality goods or equipment.

Unnecessary services

Another area for scammers involves the provision of services in relation to regulatory requirements. Many businesses need licences and approvals, or need to file reports and returns with official bodies as a regulatory requirement.

The easiest and cheapest way to meet these requlatory requirements is to deal directly with the body concerned.  Often there is no charge at all to notify, register or supply information in accordance with a regulatory requirement.

There are many scammers who would not only offer a paid service to do this type of work for businesses, but also give the impression that they are doing so through an official channel.  They may write official-looking letters making references to legislation and penalties, and demand information and payment. 

A variation on this type of scam relates to services that a business may choose to use, and where the additional services of the scammer are unnecessary. An example of this could be registering with the Corporate Telephone Preference Service.

If you need help with completing an official process it is a good idea to contact your own advisors, for example an accountant or solicitor. You can also contact the official body concerned directly.

Investment scams

This type of scam can target individuals who run successful businesses or private investors.

They encourage individuals to buy into high-risk investments with the promise of exceptional investment returns.

These investments may include:

  • shares in small, high-growth companies
  • precious gemstones and metals
  • fine art and wine

Some of these investments can be real, but the investor is not made aware of the true risks associated with it. In other situations, the investment does not exist at all.

Advance-fee fraud

In this scam the scammer may pose as a business wanting to buy high value goods from a company. They sometime use the identity of a valid company. Goods are known to be delivered, but then payment is never made.