Scams can take many forms and are mostly aimed at consumers. For an up-to-date list of scams please visit the Department of Trade and Industry website (www.dti.gov.uk/ccp/scams.)

However, in some cases businesses can also be targeted and the following is a list of some of the most common scams.

Credit Card Fraud

This usually involves the use of stolen or 'skimmed' credit cards or claims not to have received the order (denial of service) resulting in a 'chargeback' to the business from the credit card company.

West Africa or 419

The Metropolitan Police Fraud Squad constantly issues warnings, as part of a crime prevention initiative against a type of fraud commonly know as 'West African' or '419' advance fee fraud. Advance fee fraud or '419' fraud (named after the relevant section of the Nigerian Criminal Code) is a popular crime with the West African criminal element.

There are a myriad of schemes and scams - mail, faxed and telephone promises designed to facilitate victims parting with money. All involve requests to help move large sums of money with the promise of a substantial share of the cash in return. Victim's individual monetary losses can range from low thousands into multi-millions.

True figures are often impossible to ascertain, because many victims, embarrassed by their naiveté and feeling personally humiliated, do not report the crime to the authorities. If you want to know how avoid being taken in, have a look at The Metropolitan Police Fraud Squad website (www.met.police.uk/fraudalert/419.htm) or the DTI's Consumer Direct website (www.consumerdirect.gov.uk).

Premium Rate Telephone Numbers

Fraudsters use the high cost of premium rate telephone or fax numbers by tempting victims into bogus competitions, prizes, holiday offers, 'surveys' etc. The aim is to seek a response and keep the line open as long as possible (e.g. a long sales message or series of questions) while being charged at a premium rate.

See the ICSTIS website (www.icstis.org.uk).

Unsolicited Directory Entry

Companies are sent a form for an entry in a directory (e.g. an international fax directory), but hidden away in the small print is a charge for entry and perhaps a commitment to an ongoing charge in future years.

See the Stop the European City Guide website (www.stopecg.org).

Unsolicited Orders or Gifts

Some companies may send unordered products or 'gifts' and then demand payment. This is a criminal offence. More information: Legal - Consumer Protection: Unsolicited Goods or www.oft.gov.uk

Charity Promotions

Check all charity promotions with the Charity Commission to ensure they are registered, are genuine promotions and meet the legal standards required. More information: Legal - Charity Promotions or www.charity-commission.gov.uk

Trading Schemes

Trading schemes (sometimes known as direct selling or network marketing) are a legitimate form of business. However, if the main aim is to generate money by recruiting new participants rather than selling the goods or service, then it may be an illegal 'pyramid selling' scheme. More information: www.tradingstandards.gov.uk

Business Help

Companies are targeted by unscrupulous 'business experts' who claim that there is a need to comply with some legislation (eg business names, data protection, health & safety, fire precautions etc) or they offer an opportunity to evaluate the business for rates reduction or help to patent an invention etc. Inflated fees are charged, but in the vast majority of cases there is no legal compulsion. Free government help is usually available and often very little is done to help the business. Example www.informationcommissioner.gov.uk

Advertising Materials

The most common scenario is that you pay to advertise your business on place mats, calendars and other materials that will be distributed in your area and usually the materials are never produced or distribution is very limited.

Before you agree to buy, get references from previous jobs and samples of the materials that were produced. Contact the references to find out if the work was completed on time and the materials were distributed as promised. Don’t be pressured into agreeing to anything immediately. Ask how you can reach the salesperson if you decide that you want to purchase the services. Shop around locally to compare services and prices. It may be less expensive to produce advertising materials yourself or with a local business. Check with your Chamber of Commerce or other groups that you belong to for companies that may be able to help. Get a written contract that includes the company’s name, address, and telephone number, the price and payment schedule, a description of the materials, the number that will be produced, and the date and plan for distribution. Don’t pay the full amount up front. Insist on holding out a substantial amount until you have received confirmation that the materials have been produced and distributed according to the contract.

Domain Name Scam

Be aware of an underhand technique being employed by some domain-name registrars to coerce you into buying domain names that you don't need. The scam involves the registrar ringing your company and claiming that somebody has used their website to register a number of domain names based on your company's name. You are told that the name of the person trying to register the domains cannot be disclosed because of data protection laws. The registrar will claim they have a system, which cross-references the names entered in their domain registration system to see if the domain is already a company name. If it is, then they ring that company to confirm whether it is indeed them that is performing the registration. Once you tell them that it is not your company that tried to register the names the registrar will employ some scare-tactics, explaining that this could be a cybersquatter, or someone trying to profit from your name. They will then offer you the chance to buy up the domain names before this potential name-thief does.

The truth is that nobody has tried to register a domain name similar to yours, and that it is a ploy to encourage you to buy up domain names (usually at a vastly inflated price) that are vaguely related to your company name. You will often find that the company that called you up cannot be found on the Internet anywhere. Your best course of action if this happens to you is to just politely refuse, or say you will call them back later.

"Virtual Company" Shares

This scam involves shares in 'virtual' companies and it usually starts with a phone call asking for a particular individual and stating that the call is of critical importance and of a discreet personal nature. Having been put through the caller, usually an American, launches into a convincing spiel offering you the opportunity to invest in a fantastic share deal that will accrue excellent profits.

The company you are asked to invest in may be called Sun Biometrics or maybe International Biometrics and the broker that has kindly offered to let you in on the deal of the century may go by the name of Smith Fairchild, Mackenzie King or even Warren and Baker. It all sounds convincing, but of course it's a scam and sadly quite a few have been taken in, losing anything from two to twenty thousand pounds in the process.

The complexity of the scam is one reason why unsuspecting businesses have been taken in. A company contacted by Smith Fairchild, who claimed to be European Venture Capitalists based in Zurich, and after checking a number of recommended websites transferred a large amount of money and awaited the receipt of their share certificates. Three months later they were contacted by Warren and Baker and were told that the share value had increased due to a takeover bid and if the company paid a further 'bond' and kept the information under wraps their profits would be even greater.

Their suspicions were raised and having contacted the Financial Services Authority were appalled to discover that Smith Fairchild, Warren and Baker and Sun Biometrics existed only on the Internet as 'virtual companies.'

Data Protection Registration

A number of individuals/organisations are contacting companies warning that if they are not complying with the data protection act there is a £5000 fine.

How the scam works. They offer to process the application (this is not onerous and can be completed online) on your behalf and charge upwards of £95 for that service. The Information Commissioner responsible for the Register of Data Controllers states "Other than paying the annual statutory notification fee of £35, on which no VAT is payable, there is no charge made by the Information Commissioner to any data controller wishing to notify".

Our advice to check to see if you need to notify the commissioner and carry out the registration yourself. Any problems please contact us

Recently, it has come to our attention that individuals posing as "collectors on behalf of data protection" are attending business premises requesting payment for Data Protection Registration. These "collectors" produce identification cards and receipt books. There is no connection between the Information Commissioner and such individuals. The Commissioner advises those approached in this way not to make any payment and to notify the local police.

Reporting Scams

www.ripofftipoff.net and Swindon Borough Trading Standards

Conclusion

Treat all unsolicited large orders (especially from overseas) and unsolicited offers of help with some care. If in doubt, check with your professional advisor or call Swindon Trading Standards Department.