Part of my job as a small business coach is to help you avoid pitfalls and traps when I see them. There’s a new scam targeting small business owners that you need to know about, especially if you sell products! Scammers have tried this not once, not twice, but three times on me in recent memory. I’ll tell you what you need to know about these scams, how to spot them, and how to foil their scheme.
Every scam offers a bait to an unassuming or naïve bystander. You can probably think of a few more obvious scams off the top of your head, ones claiming you’re a lost duchess and you can claim your title with just a “title-reinstatement fee” or an African prince needs help moving diamonds and you’re just the right person for the job. But unfortunately, even business owners can fall prey to scams.
With this new scam, you’ll get an email (or other message) from a “customer” who is telling you that they placed an order and never received it! They don’t want you to send them that product, they need to be reimbursed for the purchase cost right away. Like the other scams that are just plain cruel, they’re preying on new and small business owners who are often so busy they’re likely to believe that they made a mistake. Or the scammer is willing to bet that the store has some sort of “the customer is always right” rule and will just send them your hard earned money anyway.
First they’ll identify themselves as a customer who has never received an item. Then cue the emotional script to play at your heartstrings. They’ll make you feel bad, sorry, and worse, guilty. “I ordered this shirt as a gift and it’s been over 30 days and I’ve never received it. This ruined my holidays!!! I need my money back now since I cannot use the gift anymore.”
Of course if you follow through with this request, you’ll be sending money to someone who never bought anything from you. If you don’t, as the scammer will let you know, they will leave you horrible reviews on all the public sites and report you to the FCC and BBB.
So, with a threat like that, what’s a business owner like you supposed to do?
Know the Red Flags
Red Flag #1 - They won’t address you by name. They’ll skip it all together or address you very formally. “Dear Sir/Madam” “To whom it may concern” “Attention Customer service department”
Red Flag #2 - They’ll say they haven’t received an item they ordered, but they won’t tell you which item it is. It’ll be a generic “shirt”, “bracelet”, or worse yet, “item”.
Red Flag #3 - They’ll say they haven’t received the item in the time window of 30 days or 60 days but never more than 90 days. Why? My guess is that it has something to do with most refund / return windows being 30-60 days long.
Red Flag #4 - They’ll give you a very specific amount of money you owe them. It’s never, “hey, I’m missing an item from my order, what can we do about it?”. It’s always direct and specific. “I paid $65.31 and it shows up on my bank records, but I never received the item. I need to be refunded immediately.” The sum is usually more than $50, but less than $100. The idea is that it’s a causal enough sum so that you might not think twice about refunding them, but high enough that it makes their time scamming you worthwhile.
Red Flag #5 - They will threaten you. Even if it’s not a direct threat, it’s a very threatening tone. Regular customers don’t usually resort to threatening the company at the first point of contact. They will threaten to leave you horrible reviews all over the internet or even report you to the FCC or BBB, ironic, huh?
Red Flag #6 - You’ll have absolutely no record of their order. I think this is actually the part that trips up most new business owners. You might think something like “well, gosh, I haven’t kept the best records, maybe I really did ruin their holiday!” or “I’ve been meaning to get organized, I must have missed this.” And you’re so wanting to please and be successful, that you’ll overlook the fact that you have absolutely no record of their order. Don’t do this! Let me assure you that digital records do not simply poof out of cyberspace. So consult wherever you collect orders, be it your ecommerce store like Shopify or your payment processor like Square or Paypal and search for their name or email. You won’t find it, not because you’re not looking but because it’s simply not there!
Collectively we need to stop giving these scammers our money. They only do it because it works. But if we all get smart, they’ll stop doing it because it won’t be successful anymore. Here’s your solution: ignore them. Yep, I’m telling you to ignore “customers”. First, you have to do your due diligence and review the information. Run it through my six red flags. Search their name, email, and even the order total through your order list to see if you get any matches. Two out of three pieces of information should match. If you have a worry that it’s still might be legit, respond this way “Oh no! I’m so sorry about that. Please reply with your order number and the email that you used to place the order so I can look into this for you.” That’s it. You won’t get a response back because there is no order to look into.
But Christine, what if they leave me a bad review?! Your chances are pretty good that they won’t. But if they do, don’t worry. You have three options: ignore it and let your good reviews bury and outshine it, publicly reply to the review and briefly say “I would have loved to come to a resolution, but I’m sorry to say that this individual has never made a purchase with us and is using their bad review as blackmail for cash.”, or report the review to the review website (Facebook / Google, etc). At the end of the day, they really can’t do anything to harm you. Ignore it and move on. They’re just a cyberbully.
I get it, this was hard stuff to think through, maybe even a little scary? Unfortunately it just comes with doing business. But you don’t have to go through it alone. Everything is scarier alone. I coach women who are new to business to take their next steps with clarity and confidence. You can book a free full length coaching call here!
Hey! I'm Christine, I'm an entrepreneur and small business owner who has learned by trial and error. I write helpful articles that help you take your next steps in business. Occasionally I like to mix things up and dash in a bit of lifestyle topics. Thanks for being here!