It's a sad fact of our modern lives, both personally and in business, that there are some unscrupulous individuals out there who wish to deceive and con us.

We've unfortunately had to report on occurrences affecting dealers in our industry in this newsletter recently - both with the story regarding the tool sharpening scam from a couple of weeks ago and today's warning from Stephen Gale from GAB about a dodgy phone transaction.

Most likely everyone reading this Weekly Update will have come face to face with some sort of scam at some point. I personally very regularly get calls during my working day from people claiming to be from my Internet Service Provider or Microsoft, telling me I have a virus on my computer or some such nonsense.

And it's almost inevitable that dealers in our sector will meet a fraudulent transaction at some point - very possibly perpetrated over the phone.

Action Fraud, the National Fraud and Cyber Crime Reporting Centre, say that for small businesses, knowing your customers is vital for protection from crime. They say that there are simple things you can do to help prevent fraud, guarantee sales and protect your bottom line. Just as you need to know your customer to successfully market your products and services to them, it is equally important to know who you’re dealing with to protect your business.

Some examples Action Fraud give of specific threats which dealers could face include:

• Electronic Payments/Card fraud
• Cheque Fraud/Cheque Overpayment Fraud
• Long/short firm fraud

The key to protecting yourself, they say, is to take time to assess the customer’s profile and the transaction they are requesting. Just like Stephen Gale did in his warning today, using your common business sense is essential. As Action Fruad say, you will often know when something isn’t quite right and, even though it may sound clichéd, there is a lot of sense in remembering that if it seems too good to be true, it probably is.

Again, like with GAB's recent experience, the experts warn that SMEs should be always on the lookout for suspicious orders.

A dealer's intuition can often be the best judge of whether a customer interaction seems right, but Action Fraud offer the following tips which could help you to pin-point suspicious behaviour:

• Irregular purchasing patterns - including larger than usual orders, multiple purchases of the same item, a series of rapid orders/transactions from a new customer, or a change in behaviour from a regular customer.
• Requests to dodge your processes - whether for payment, invoicing, delivery and so on.
• Lack of interest in the product and asking few questions on its details, particularly if it’s high value.
• Delivery irregularities - for example, if the buyer is unconcerned by delivery costs or wants the goods shipped to an address overseas, or one that is different from the card address. Whilst there could be a perfectly legitimate explanation for the above, they could also be an indicator of fraud. If in doubt, then follow-up by asking for more information.
• Receiving a cheque for more money than the product or service is being sold. The fraudster will usually ask for you to return the difference before the funds have been cleared and ultimately the cheque will bounce.

Whilst there could be a perfectly legitimate explanation for the above, they could also be an indicator of fraud. If in doubt, the advice is to follow up by asking for more information.

The key question with this type of fraud seems to be is your customer really who they say they are?

The advice is if you are in any doubt about a transaction, make sure to gather as much information as possible to establish your customer is legitimate.

Ask common sense questions around the nature and purpose of the order or request a form of identification or proof of address to check they match the details you’ve been given.

Remember, if you are in any doubt about their validity - then do not proceed.