Scams that Businesses Fall For

The news recently has been blanketed with accounts of the Immigration and CRA frauds making the rounds in the GTA. In these frauds, people phone individuals and advise that they will deported or they are going to jail in the hour because they have not paid taxes. Many vulnerable people have paid money to these criminals out of fear.

People are not the only ones at risk, businesses can fall prey to scams as well.

I’ve been in business over 23 years, so I’ve seen a few scams before the internet really took off. Of course, as someone carrying on business in the 1990s, I received my share of the Nigerian Mail Fraud invitations. Letters (real letters, not emails) were sent to owners of businesses asking for their help in exchange for huge sums of money. I recall at the time wondering how people could fall victim to this, then I met someone who said his business had been in a downward spiral, he was religious, had just returned from Church and felt this was his miracle. The business closed.

One of the scams I really enjoyed was when toner and a bottle of wine was sent to our firm (never ordered either). The toner came with an invoice, the wine was described as a gift. My Mom always said it’s not nice to refuse gifts, so I returned the toner to sender and kept the gift.

The non-approved invoice scam continues in various forms today. Midsized companies are most vulnerable to this if they do not have strict approval processes. Often, an invoice can end up in the system and paid, though the service was never ordered.

Lawyers are currently the target of particularly sophisticated scams. Emails from foreign companies seeking collection help are actually an attempt to have a fake “certified” cheque deposited into a lawyer’s trust account and then taking out immediately, leaving the Lawyer holding the bag.

Ultimately, the old adage, “if it seems to good to be true, it probably is” is the best way to carry on business. That and have tight procedures that are followed before paying invoices.

Inga B. Andriessen JD