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Scam Alert

Scammers Target Small Businesses

Marketing and promotion ploys leave business owners ripe for a rip-off

Small-business owners continue to be a big target for scammers. Although some schemes focus on specific occupations, pretty much any small business is ripe for a rip-off in a burgeoning new trend: Scams that play on a company's need to promote itself in a still-struggling economy.

The phony phone book. In a ruse that dates back to the days of rotary phones, scammers who claim to be from the Yellow Pages have been tricking small businesses into paying for bogus directory listings. It usually begins with a call, fax or letter asking the business owner to "confirm" its phone number and address — followed by an invoice for a listing in a nonexistent directory. In recent years, crooks have added bogus online directories to the mix.

Yellow pages directory, Scam Alert, Small businesses are targets for Yellow Pages scams

Small businesses are targets for Yellow Pages scams. — William Whitehurst/Corbis

The good news: After a Federal Trade Commission investigation, one such operation was recently busted, and a federal court ordered that more than $10 million be paid back to defrauded small businesses, nonprofits and churches.

In that scam, the FTC says, businesses were sent authentic-looking faxes that appeared to be from their local Yellow Pages directories — complete with the "walking fingers" logo. Businesses were told they needed to return the form to pay for an $89 per month, two-year registration with an online directory. Those who returned the faxed form were then billed by a shell company and instructed to send more than $1,000 to a Park Avenue address in New York. Businesses that tried to cancel were then subjected to "threatening and intimidating collection tactics."

Although this major player is now out of the scamming game, you can expect others to follow. So if you get directory listing inquiries, invoices or even letters claiming "this is not a bill" (the fine print may suggest otherwise), look up your local phone directory's phone number and call it to confirm whether it sent you the material — don't use the number you've been given. The same applies to inquiries concerning your business's website hosting service; scammers sometimes claim to be from them as well.

Service swindles. Another type of telephone trickery is sending emails that falsely claim to be from phone-service providers, such as Verizon Wireless or Comcast. The Verizon email claims to be about an unpaid bill; in fact, if you click on a "see details" link, your computer becomes infected with malware. The Comcast con asks you to update the credit card "used to pay this account."

Unlike many such scam emails, both these messages are convincing-looking replicas, with an authentic address displayed and text absent of the scammers' typical typos and misspellings.

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Video Extra

Avoid Phishing Scams: AOL Consumer Advisor Regina Lewis shows us how to detect email phishing scams—and how to avoid taking the bait.

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