It doesn’t take a lot to fool a hurried small business
owner. Case in point: The Federal Trade Commission just announced a
series of legal actions
against three Montreal operations accused of talking U.S. small
business owners into paying millions of dollars for local yellow page
listings the merchants neither bought nor received.
A common
version of the scam went like this: The crooks called small businesses
(some nonprofits, churches, and local government agencies also fell
victim) and asked to confirm the shop’s name, address, and telephone
number. Then the fraudsters call again to tell the business that they
owed amounts as high as $1,800. When the business owners protested, the
crooks played back recordings of the earlier phone calls, doctoring
recordings to make it sound like the merchant had agreed to pay.
It sounds crude, but plenty of business owners coughed up the cash. One group of scammers
tricked thousands of victims out of at least $4.9 million, according to
a complaint filed by the FTC in U.S. District Court in Florida.
Directory listing scams aren’t new. In 2012, an Illinois court
ordered a group of companies operating out of Palma de Mallorca, Spain,
to repay $10 million to small businesses shaken down for payments for listings the merchants never agreed to buy. In that version of the scheme, crooks sent faxes bearing the “walking fingers”
logo associated with local yellow pages. Merchants who returned the
faxes were billed for $1,000 and threatened with aggressive collection
tactics.
By trading fax machines for tape recorders and audio
editing, the scammers may have climbed up a rung on the ladder of
low-tech schemers who prey on Main Street. They’re not as sophisticated
as the tin-foil bandits
who clamber on the rooftops of convenience stores with rolls of
aluminum wrap in an elaborate ploy to buy cigarettes with stolen credit
cards. But they’re way ahead of the crude criminals who simply call
small business owners and ask for cash.
http://www.businessweek.com
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