In January 2009, I wrote this blog in response to a flood of emails I had received regarding a fake shipping scam targeted at small and mid-sized businesses that can cost companies upwards of $10, 000, in addition to lost product and time.
In the more than four years since publishing the blog originally, the post has received hundreds of comments from business owners worldwide that have been victims, or near-victims to these scammers. Several of these owners have offered a number of new red flags to help business owners spot these scams.
This blog update includes the new red flags and additional tips for business owners. Make sure your customer service and sales team is aware of the scam, so you catch on before you get caught.
UPDATED: Red flags for fraud
- Email orders with numerous typos and grammatical problems
- Orders for large quantities product
- Orders that require long-distance shipping (often for products that could be easily sourced from a local supplier)
- Orders that request use of a shipping company chosen only by the customer (unfamiliar companies that are not easily discovered in an Internet search)
- Orders paid for with a credit card that has a different billing address than the shipping address
- Orders from a Gmail, Yahoo or other free email account
- Email orders with an overseas timestamp (often the timestamp doesn’t match the stated location of the purchaser)
- Quotes for freight do not include a phone number
- Orders through relay operator for the hearing impaired
In August, we launched a Scam Alert page on GlassMagazine.com to alert readers of fraudulent ordering schemes, including scams using fake shipping companies. Since posting the warning page, I have received numerous e-mails and calls from small business owners and managers in and out of the industry who have been affected. The same scams that have plagued the glass industry have hit vinyl dealers, print shops and even ice cream truck suppliers. Many owners caught the scam in time. Others were not so lucky.
I don’t want to belabor the point—I have blogged and reported on these scams previously-but the best way, and seemingly the only way, to beat a scam is to stop it before it happens. Know their tactics. Know the red flags.
According to my scam sources (a.k.a., business owners that have been scammed or nearly scammed), this is how the fake shipping company scam usually works:
- A customer contacts a shop via relay operator or e-mail to order a large quantity of product; in the glass industry, it’s usually 1/8-inch or ¼-inch annealed glass. (Red flags: The email exchanges are often littered with misspellings and poor grammar, and often come from a Gmail, Yahoo or similar free e-mail account.)
- The customer wants to pay for the product with a credit card and wants to ship the order a large distance, sometimes the end destination is across the country, sometimes it’s on another continent. The purchasing credit card is usually stolen. (Red flags: Scammers usually place an order for products they could easily get from a local shop, and the credit card billing address doesn't match the shipping address.)
- The customer says they want to use their preferred shipping company to transport the product. The customer asks the business to pay the delivery company directly and says they will send a check or money order the business to repay the delivery costs. (Red flag: Business owners have reported scammers request to use the shipping companies AGC Delivery International, Ox Direct Shippers or Cargo Trust Shipping Freight Co.)
- After the business has paid the delivery company, the scammer’s check or money order won’t go through, leaving the business without the thousands of dollars of delivery costs and with wasted product.
“We almost got taken. We had a order for approximately $12, 000.00 to be shipped to Ghana. $6000.00 of that was shipping to be paid to via money gram to Agc Delivery International, ” one business owner told me in a recent email. "I did not start checking things out until the three cards they gave me were declined. I typed the delivery company and your site popped up.”
If you are contacted by a scammer, tell your peers and tell us. We’ll anonymously post your scam stories, fraud identification tips and any other advice you have on our Scam Alert page to help warn other business owners. Leave a comment on this blog, or e-mail me directly.
The opinions expressed here and in reader comments are those of the individual authors and do not necessarily reflect those of the National Glass Association, Glass Magazine editors, or other glassblog contributors.