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"FACT - Fraud Awareness for Commercial Targets: Practical Advice on How to Protect Your Businesses or Not-For-Profit Organization Against Fraud"

This downloadable self-guided learning tool is a powerful, and insightful look at mass marketing fraud and how it can victimize any organization, large or small.

If you are interested in having the Competition Bureau deliver a presentation to your organization, or if you have general questions about scams, please contact us.

Download : Presentation
- (PDF; 763KB; 21 Pages)
- (PPT; 2MB; 21 pages)

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Menu

• Mass Marketing Fraud is a Serious Crime


• Scope of the Problem
• Competition Bureau Experience
• Competitive Impact


• Overview


• What You Will Learn


• Common Techniques of Fraudsters


• Who Are These Fraudsters
• Your Guard Is Down


• Types of Business Scams


• Why These Scams Work
• Profile of a Typical Scam


• Key Phrases Used by Fraudsters



• Why You May Be Vulnerable to Fraud



• How to Protect Your Organization


• How to Say No


• How to Build an Anti-fraud Plan



• Contact the Competition Bureau

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FACT: What is Fraud Awareness for Commercial Targets?

The FACT campaign will help your business or not-for-profit organization to:

• Arm you and your colleagues with the tools necessary to avoid falling victim to mass marketing fraud



• Join the fight against scamsters



• Protect your organization’s bottom-line

Mass Marketing Fraud

A deceptive or misleading business practice where you receive unsolicited or uninvited contact via mass media (either by email, fax, telephone, mail or advertisement) and false promises are made to con you out of your money.

Mass Marketing Fraud is a Serious Crime

Scope of the Problem

• Estimated that 95% of victims of mass marketing fraud do not report it to authorities



• Myth that scams only target certain consumer demographics (i.e. – elderly, uneducated, naïve)



• Those who lose money to scams are 30% more likely to be scammed again

Competition Bureau Experience

• In 2006-07, 67% of fraud cases pursued by the Bureau under the criminal regime of the Competition Act were scams that targeted businesses

Competitive Impact

• Scams in the marketplace undermine trust in legitimate business activities and negatively impact their profit margins



• Fraud costs businesses and not-for-profit organizations millions



• Canadian businesses are losing money annually to these scams, leading to increased costs that compromise their "competitive edge"



• Losses to not-for-profit organizations impede their ability to deliver programs and services to those who need it most

Overview

What You Will Learn

• Common Techniques of Fraudsters



• Types of Business Scams



• Key Phrases Used by Fraudsters



• Why You May Be Vulnerable to Fraud



• How to Protect Your Organization



• How to Build an Anti-fraud Plan

Common Techniques of Fraudsters

Who Are These Fraudsters That Are After Your Organization’s Hard-earned Money?

• You expect : shifty, uneducated, creepy



• They present : friendly, bright, efficient

Your Guard Is Down

• You expect : a telemarketing sales call



• They present : a call to confirm your address or resolve a shipping problem



• You expect : high pressure tactics



• They present : business as usual

Types of Business Scams: Office supply scams

• Paper



• Toner



• First aid kits



• Light bulbs



• Rolls for credit machines

Why These Scams Work

• Scam artists pose as your regular supplier.



• There is little difference between brands so you will likely buy what’s cheapest.



• All offices need these goods, many are essential.

Profile of a Typical Scam

• On 1st call, the fraudster gathers details to be used later.



• On 2nd call, the fraudster gets you to agree to receive a shipment. This call is often recorded.



• A shipment arrives. The products are overpriced and of poor quality.



• The shipment can’t be returned. You can’t reach the company to discuss the matter.



• If you don’t pay, you get aggressive collections calls. The recording is used to prove that you "agreed" to a purchase.



• You feel threatened or frustrated and so you agree to pay.

Types of Business Scams: Directory Scams

• Industry listings



• Top 100 companies in your city or nation



• Who's who in your sector

Profile of a Typical Scam

• You are asked to advertise within and/or purchase a directory targeting your sector or industry.



• The directory never arrives, or contains no reliable information

Why These Scams Work

• All organizations want to promote themselves - it's an easy sale for the scam artist.



• Can consist of real information and bogus entries, but if you don't look too closely or use it, you may not realize that it's a scam.

Types of Business Scams: Phoney Invoice Scams

Profile of a Typical Scam

• You receive an invoice for a service you commonly order so you pay it.



• You put their address on your vendor list so other charges are paid without question.

Why These Scams Work

• Invoice has the look and feel of a bill, from a legitimate company.



• Amounts are low so the charges aren’t scrutinized.

Key Phrases Used by Fraudsters

• We are calling about a pre-authorized purchase.



• We've had some delays in our shipping department and need to confirm your order.



• I was speaking with you previously.



• Do you require a purchase order or can I send it directly to you?



• We'll be recording our call for quality control purposes.



• May I ask what kind of printing equipment you use?



• We are calling to confirm shipping details.



• We are calling to confirm your account information.



• You have a two-year listing with us.



• I am calling to approve your advertising copy for our directory.

Why You May Be Vulnerable to Fraud?

• You believe this doesn’t affect you.



• You are too busy to inform yourself about fraud.



• You don’t have processes in place.



• You are distracted when you answer the phone, read email or pay invoices.



• You don’t have time to deal with aggressive collections calls.



• You experience regular staffing changes.



• You recognize the company pitching to you but don’t pay attention to details.



• You don’t report fraud to the authorities.

How to Protect Your Organization

How to Say No

• I need to see an offer in writing first.



• Send me a copy of our order.



• We only pay with evidence of a signed authorization.



• I cannot agree to be recorded.



• I need to consult my manager before making any decision.



• I cannot accept a shipment without written proof that we’ve ordered it.



• I'm not interested. Remove us from your contact list.

How To Build an Anti-fraud Plan

• Closely examine ads or offers and ask questions.



• Ask for information about the business address, product line and customer references.



• Hang up if you feel that this is not a legitimate company or offer.



• Don’t judge reliability by look or feel.



• Ask for a copy of the offer in writing!



• Make it your policy not to agree to purchases over the phone.



• Review all invoices and vendor lists each quarter.



• Be wary of requests to update your information.



• Assign a limited number of employees to make purchases.



• Before paying, make sure that you get what you ordered.



• Talk to your staff and colleagues about fraud.



• Start a reward program for employees who prevent or uncover losses.



• Ensure your firewall, anti-virus and anti-spam software is up-to-date.



• Report fraud to the Competition Bureau.

Contact the Competition Bureau

Competition Bureau Canada
50 Victoria Street
Gatineau, Quebec
K1A 0C9

Report fraud online at: www.competitionbureau.gc.ca

Call toll-free at: 1-800-348-5358