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Supplies Surprise

Scam:   Scammers pressure office workers into "ordering" substandard, overpriced goods.

REAL FRAUD WHICH GENERALLY COSTS ITS VICTIM BETWEEN $100 AND $1,000

Example:   [Collected on the Internet, 2000]

Supposedly, someone calls and asks for your office copier serial number and the next thing you know, a palette of cheap, low grade copy paper is delivered, along with an invoice for some exorbitant amount. The "scam artists" assume, probably, that the invoice will get paid due to "paper work shuffle."
 

Origins:   This scam Supplies has been around at least since the late 1970s. Even that long ago, secretaries were routinely cautioned against falling for these schemes, and during my time working in an office environment it seemed every summer I or my co-workers fielded at least three calls of this scammy nature.

The key to the fraud's success is gathering enough information about the targeted company and what products it uses to make the "order" appear legitimate. Con artists begin their assault by wheedling tips about what supplies the business uses out of whoever answers the phone. (Sometimes they pretend to be conducting a survey.) The fraudsters generally make a point of finding out who is in charge of ordering for the targeted company, because this name will be used on the
invoice.

Once useful information has been extracted, the assault begins in earnest. The scammers will call back to offer to sell at discount prices the very products the company routinely runs through. Or they phone to "confirm" what they claim is a standing order, using the information harvested earlier to make the transaction sound routine. Or they skip the call back part of the scam entirely, instead sending unannounced boxes of product along with an invoice that quotes the name of the firm's office manager.

Similarly, what have come to be called "toner phoners" usually start by calling and pretending to double-check a copier's serial number, then offering to restock a company's toner supply at reduced rates. What ends up being shipped, of course, is horribly overpriced product of exceptionally poor quality.

These scams can involve outright lies, with the person on the phone claiming to be the firm's regular supplier, or maintaining that the offer is "special" or "good for a limited time" or is coming in just ahead of a scheduled price increase.

Products foisted onto the unsuspecting are almost always badly overpriced (sometimes running ten times as much as they are worth) and not of the brand or quality the business usually orders. A partial list of products successfully fobbed onto victims is:
  • Photocopier toner
  • Photocopier paper
  • Ink cartridges
  • Light bulbs
  • Urinal deodorants
  • Cleaning solution
  • Typewriter ribbons
  • Rubber gloves
Between 1991 and 2000, the Federal Trade Commission pursued 25 cases of office supply fraud. In 1999, the U.S. Postal Inspection Service conducted 1,393 investigations of fraud against businesses, resulting in 548 arrests and 522 convictions. Even so, an ounce of prevention continues to be worth a pound of cure, and the savvy will work to avoid becoming pigeons who have fallen prey to these schemes rather than rely upon others to dig them out of the pigeon pie they've let themselves be baked into.

Barbara "pigeon towed" Mikkelson

How To Avoid Falling Victim To 'Office Supplies' Scams:
  • Prevention is simple, a mere matter of schooling those charged with answering the phone to not give out information regarding office supplies or equipment, and to refuse to provide the name of the person responsible for purchasing. Messages should instead be taken with the promise of their being passed along to the appropriate unnamed individual. In particular, employees should be cautioned to refuse to answer questions asked as part of a survey, because this ploy is often used to extract the precise information needed upon which to base a more believable scam.
  • Even if your firm falls for such a scam, all is far from lost. According to the FTC, companies are not required to pay for unordered supplies. They also are under no obligation to return the goods — unordered merchandise can be treated as a gift.
  • A common ploy of the scamsters is to send their invoice a week or more after the supplies have arrived. Their purpose is twofold: the legitimacy of the inflated invoice is less likely to be questioned once the goods have been stocked away, and many of those victimized feel they're under a legal obligation to pay what's being demanded if anything from the shipment has been used in the interim, thus rendering impossible the return of the intact order.

    Intact or partially-used, the rule about this merchandise is the same: If it wasn't legitimately ordered, it doesn't have to be paid for or even returned. Those intent upon bilking your corporation may well try to claim the shipment was ordered by an employee of the firm, thereby making payment for it mandatory. They may deign to accept the shipment back provided a substantial "restocking fee" accompanies the return. They may pretend to act shocked at the price read to them off their invoice and offer to negotiate the cost down. Or they may send dunning letter after dunning letter demanding payment in full and threatening court action if your firm refuses to settle up. Realize this is all part of the con.
  • Don't give in. Don't believe the threats, and don't send money. Those who give in to the pressure and dash off a hasty check to put an end to the bullying may well find they've set their firm up for numerous additional episodes of the scam. The same con artists may come back for a second and even a third visit, this time claiming a new shipment of disputed goods had been on backorder, or that they hold a service contract on some piece of office equipment. Or they may sell your company's information to other scammers on the grounds that to others in this field a proven sucker is practically money in the bank.
Additional Information:
    FTC on Avoiding Office Supply Scams   FTC on Avoiding Office Supply Scams
  (Federal Trade Commission)
    Five Steps to Avoiding Office Supply Scams   Five Steps to Avoiding Office Supply Scams
  (Federal Trade Commission)
    BBB on Scams Aimed at Businesses   Scams Aimed at Businesses
  (Better Business Bureau)
Last updated:   11 July 2011

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Sources:

    Quaid, Libby.   "Fraudulent Telemarketers Bilk Millions From Small Businesses."
    The Associated Press.   28 March 2000   (State & Regional: Washington).

    Srinivasan, Kalpana.   "Scams Dump Unordered Products on Businesses."
    The [Bergen County] Record.   22 February 1999   (p. A10).

    Bangor Daily News.   "Office-Supply Scams Can Cost a Bundle."
    16 February 1998.