As fraudsters grow more daring with scams targeting businesses we thought it might be a good time to highlight what to be aware of so you can take precautions and not become a victim of this scam. Understanding how some of these scams work is your first line of defense in not falling for the deception. These scammers have gotten very tricky and very smart, but hopefully by reading this you can be one step ahead of them.
One of the more prevalent scams that has started to become very popular with these criminals is a fraud scam involving quotes and large orders for products that originate from a university. It goes like this:
- The scammers find the purchasing contact for a major university and assume his/her identity. This can easily be found on the Internet.
- They set up a fake website to create an online presence and obtain a fake email address that mimics the university, usually ends with something like xyz.edu.net.
- They call and email companies to place an order for random products and identify themselves as being from that university.
- They create fake purchase orders that resemble an authentic university purchase order.
- Ask for Net 30 terms by sending false bank & credit references as well as fake W-9 (all the while using university contact names & addresses.)
- Lastly they request shipment to a location that is somewhere in proximity to the university location.
After what appears to be a legitimate request and order, businesses fill the requested PO only to find out that they have been scammed and will not be getting paid for the products they provided. Having been given Net 30 terms for payment, the scammers have at least a 30 day head start on any investigation that may arise, making it very difficult to recover the businesses money or product.
Here are a few things you can do to try and avoid being scammed when you receive PO’s from universities (or any institution for that matter):
- In the case of a university, if the email address or website URL does not end in .edu, it is likely fraudulent.
- Question the shipping address if it is not the same as the university or business address.
- Verify the phone number calling actually matches the purchasing agent at the university. Then call that person and verify they have or have not requested an order.
- Do your research! Legitimate companies are going to have some kind of history or “digital footprint” on the Internet. If you can find little or no information on a company that should raise red flags.
- Be extra diligent with unusually large orders from new customers.
- Trust your gut. If something doesn’t seem right, it probably isn’t. Confirm and verify all the info and then verify it again.
If you do become the victim of one of these scams it is very important to contact your local authorities and the FBI as soon as you find out. You should also report the crime to the FBI’s Internet Crime Complaint Center (IC3).