False orders filtering into rural Snake River Region; Use caution in accounts payable

By Robb Hicken/ BBB’s chief storyteller

The Supply Reorder Number  and description of materials ordered is clearly marked along with a master order number: PC446906.

“It just looks so real,” says MaryAnne Pettingill, office manager for Evans Realty in Emmett. “But, we are very hands on in our ordering for the machine in our small office.”toner order

The link associated with the email suggests Xerox definitely supplied the email and alert that the Xerox in her office required more toner.

“If we had an order from Xerox, I’d be first to know about it,  because I would have placed the order,” Pettingill says.

Bob Wagner, director for Technology Business for Xerox, told Better Business Bureau, “The email is a confirmation of the customers’ next automatic supplies replenishment shipment and the customers will receive a second email once their order has shipped.”

Matt Ingersoll, president of Boise Office Equipment, said this order appears to be correct. On many occasions, companies sign agreements that will process an order automatically after they report a certain number of copies on their equipment.

“This appears to be a BOE service agreement where the toner is ordered and sent directly to the client,” Ingersoll says. “It was wise to question any order, invoice or shipment, since there are crooks trying to take advantage of small business.”

Office supply scam artists generally use three ways to take your money — the phony-invoice, the pretender, and the gift-horse.

The goal of the phony-invoice scam is to get the name and address of an employee so your organization can be shipped and billed for unordered goods or services. The invoice includes the employee’s name as the “authorized” buyer. Scam operators use various ploys to get an employee’s name: They may call asking for help completing an order, claiming that “the accounting department lost the name of the person we should send these supplies to,” or they may ask for the name of the person in charge of your Yellow Pages advertising.

Once the con artist has an employee’s name and address, he’ll ship the unordered merchandise. The phony invoice arrives a week or so after — for two reasons: First, the inflated price — as much as 10 times what you’d pay for the same goods from a legitimate supplier — is less obvious if the invoice arrives after the merchandise has been received and stocked. Second, the chances are good that you’ve used the merchandise before the invoice arrives. Many organizations mistakenly believe that they must return unordered merchandise or pay for unordered merchandise if they’ve used it.

Federal postal laws concerning unordered merchandise are clear

A twist on this approach may have the fraudster timing a phony invoice to match your purchase of legitimate services from another vendor. For example, the seller sends you a bill for unordered classified advertising soon after your ad runs in a legitimate publication. The scam operator hopes you’ll be confused and pay his bill instead of, or in addition to, the one from the legitimate company.

Protect Your Organization
You can protect your organization from paying for unordered goods and services. Here’s how:

1. Know your rights. If you receive supplies or bills for services you didn’t order, don’t pay, and don’t return the unordered merchandise. You may treat unordered merchandise as a gift. By law, it’s illegal for a seller to send you bills or dunning notices for unordered merchandise, or ask you to return it — even if the seller offers to pay for shipping. Further, if the seller sends you items that differ from your order in brand name, type, quantity, size, or quality — without your prior express agreement — you may treat the substitutions as unordered merchandise. Unordered services are treated the same way. However, first consider the possibility that the seller made an honest mistake.

The FTC’s Telemarketing Sales Rule offers more protections in business-to-business sales of non-durable office or cleaning supplies and most sales of goods or services to people, groups, or associations. The rule requires telemarketers to tell you it’s a sales call — and who’s doing the selling — before they make their pitch. They must tell you the total cost of the products or services they’re offering, any restrictions on getting or using them, and that a sale is final or non-refundable before you pay. It’s illegal for telemarketers to misrepresent any information, including facts about the goods or services being offered.

2. Assign designated buyers and document your purchases. For each order, the designated employee should issue a purchase order — electronic or written — to the supplier with an authorized signature and a purchase order number. The order form should instruct the supplier to note the purchase order number on the invoice and bill of lading. The buyer should send a copy of every purchase order to your accounts payable department. Keep blank order forms secure.

3. Check your documentation before paying bills. When merchandise arrives, the receiving employee should verify that it matches the shipper’s bill of lading — paying special attention to brands and quantity — and your purchase order. Refuse merchandise that doesn’t. If everything’s in order, the employee should send a copy of the bill of lading to your accounts payable department. Bills for services should be reconciled the same way. A supplier should not be paid unless the invoice has the correct purchase order number and the information on the invoice, the purchase order and the bill of lading match.

4. Train your staff. Train everyone in how to respond to telemarketers. Advise employees who are not authorized to order supplies and services to say, “I’m not authorized to place orders. If you want to sell us something, you must speak to ______________ and get a purchase order.”

Buy from people you know and trust. Authorized employees should be skeptical of “cold” or unsolicited calls and feel comfortable saying “no” to high pressure sales tactics. Legitimate companies don’t pressure you to make a snap decision. Finally, consider asking new suppliers to send a catalog first.


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