Unfortunately today small business owners need to be concerned not only with winning and maintaining loyal customers, but protecting themselves from the fraud and deceit of predators in the business world. The Better Business Bureau receives thousands of reports each year from small business owners who have fallen prey to some kind of business scam.

Because small business owners rarely have the time, energy or resources to fight back, they are the frequent targets of such unethical practices. St. Joseph businesses are not immune. Business owners receive regular sales pitches from vendors promising to save them money on credit card processing. Small business owner Nancy Goode experienced this firsthand at Café Pony Espresso.

Nancy was approached by a salesman who claimed that he could save her 48 percent of what she was paying in credit card processing fees. The salesman took the time to compare her current provider statement line by line against what his company was offering. He also said they would provide her with a new credit card machine, one he would help her install.

Within days a new machine did arrive, but the salesman was never seen again. Nancy hesitated to use the machine until a phone call to the company assured her that everything was in order and all she needed to do was hook it up. A mere 24 hours after doing so, a $174 withdrawal was made from her checking account. When Nancy tried to track how this had happened, she found that her agreement with the original company had been transferred to a third party, without her knowledge. This entity claimed to possess a contract with her signature.

Instead of saving money on credit card processing, Nancy found herself involved with two separate contracts, neither of which she was interested in maintaining, and one of which she says she never signed. Nancy has made numerous complaints to the company and even to the Missouri Attorney General. Meanwhile, she changed bank accounts in order to stop the automatic withdrawals.

Here are some other common scams against which you should remain alert if you are a small business owner:

Business Directory Listings
Scammers take advantage of your desire to be listed in a business directory. They may pose as a representative of the Yellow Pages when, in fact, they are part of another, smaller business listing service – perhaps an online site. Only later, when you receive an enormous bill do you find that they were not who they claimed to be and have charged you for services other than what you expected to receive.

Business Awards
While some scams rely on normal office procedures to get their foot in the door, others rely on your sense of vanity. If you are told that you have been nominated to receive a business-related award which costs you money – be sure and check it out thoroughly.

Be on the watch for customers who purchase a big ticket item and pay with a check or credit card in excess of the purchase amount. Then they ask you to reimburse them the difference. Too late you will discover that the check bounces or the credit card was fraudulent.

If an offer sounds too good to be true, it likely is and you’ll gain more benefit from walking away.

About credit card processors, there are many local entities, banks and processors that offer services that can save you money each month. Be sure to ask for references, especially from other local business owners that you may know and trust that use their services. Ask for advice from your Chamber or in this website’s Small Business Resource Center LinkedIn group.

Kristi Bailey
Director of Communications

As Director of Communications for the St. Joseph Chamber of Commerce, Kristi Bailey is responsible for the management, development and design of Chamber publications including newsletters, electronic correspondence, annual products and news releases. She also is responsible for website content. Ms. Bailey also assists staff in the development of marketing materials.