The Better Business Bureau of the Mid-South and the Memphis FBI office are warning area businesses of a scam that appears to be targeting area franchise and small business owners. Some businesses in the Memphis area have already been victimized. Those businesses have filed reports with the Memphis FBI office, who alerted BBB to this new scheme.
How the scam works
Often, the scammer shares a piece of information that only someone inside the company should know, thus leading the victim to believe the caller is legitimate. The phony caller then instructs the employee to gather all of the cash on the business premises and buy prepaid debit cards with the cash, presumably to keep something bad from happening to the employee or the franchisee. The employee is instructed to call the caller back and provide them the numbers on the back of the debit cards. The money is then lost.
In both reported cases, the imposter was using the name of someone at the corporate offices – information that is readily available online. The employees who received the calls were told that they, too, would be in trouble if they did not cooperate. The businesses who were victimized lost at least one day’s revenue to this scam.
Randy Hutchinson, BBB of the Mid-South president, said, “Impersonation scams involve a caller pretending to be someone they’re not. In many cases, they pretend to be someone in authority, hoping to intimidate the victim into complying with their wishes.”
The FBI is warning small businesses to be wary of this scam and educate their employees about it to prevent other businesses from being victimized. Weekend employees who work the closing shifts are the ones being mostly targeted.
How to report this and other scams against businesses
Contact the Memphis FBI Complaint hotline at (901) 747-4300 to file a complaint if you or your business is a victim of a scam or you receive a call similar to the ones outlined above.
FBI Complex Financial Crimes Supervisory Special Agent Joel Freund states, “In order to stop people from becoming victims of these types of scams, educating the companies and the employees is our best defense. These scammers are experienced in making people trust them and then striking fear into the employees if they don’t follow their instructions. The public needs to know about these potential scams and hang up if they receive this type of call.”
How to protect your business
Business owners and franchisees should share these red flags of business scams with their employees:
- Scammers pretend to be someone you can trust. They often make themselves seem believable by pretending to be connected with a company you know or a government agency. In this case, the crooks used the name of the Chief Operating Officer at corporate headquarters to make their scam believable.
- Scammers use intimidation and fear. They tell you that something terrible is about to happen to get you to send payment before you have a chance to check their claims.
- Scammers create a sense of urgency. They rush you into making a quick decision before you look into it.
- Scammers use untraceable payment methods. They often want payment through wire transfers, reloadable cards, or gift cards that are nearly impossible to reverse or track.
For more information about business scams and to download an infographic and brochure to share at your workplace, visit bbb.org/smallbusiness.
ABOUT BBB: For more than 100 years, the Better Business Bureau has been helping people find businesses, brands and charities they can trust. In 2017, people turned to BBB more than 160 million times for BBB Business Profiles on more than 5.2 million businesses and Charity Reports on 11,000 charities, all available for free at bbb.org. There are local, independent BBBs across the United States, Canada and Mexico, including BBB Serving the Mid-South was founded in 1948 and serves 28 counties in West Tennessee, East Arkansas and North Mississippi.