Five
Steps to Avoiding Office Supply Scams
Businesses, churches, and fraternal and charitable organizations are losing millions of
dollars to bogus office supply firms. Any organization that lacks adequate purchasing
controls can become a victim of an office supply scam. The Federal Trade Commission
suggests a few simple precautions to protect organizations from paying for goods and
services they didn't order, from labels to light bulbs, toner to toilet paper. We've also
attached a tip sheet - Inter-Office Memo: Don't Get Bilked by an
Office Supply Scam - that you can adapt to your organization and distribute
to staff.
1. Know your rights.
If you receive supplies or bills for services you didn't order, don't pay. Don't return
the unordered merchandise, either. Treat any unordered merchandise you receive as a gift.
It's illegal for a seller to send you bills or dunning notices for merchandise you didn't
order or ask you to send back the merchandise - even if the seller offers to pay the
shipping costs. What's more, if the seller sends you items that are different from your
order in brand, type, quantity, size, or quality - and hasn't gotten your approval first -
you may treat the substitutions as unordered merchandise. Treat unordered services the
same way. At the same time, you should consider the possibility that the seller has made
an honest mistake.
The FTC's Telemarketing Sales Rule offers other protections in business-to-business
sales of non-durable office or cleaning supplies and most sales of goods or services to
individuals, groups or associations. According to the Rule, telemarketers must tell you
it's a sales call - and who's doing the selling - before they make their pitch. And before
you pay, they must tell you the total cost of the products or services they're offering,
any restrictions on getting or using them, and whether a sale is final or non-refundable.
In addition, it's against the law for telemarketers to misrepresent any information about
the goods or services they're offering.
2. Assign designated buyers and document your purchases.
Designate certain employees as buyers. For each order, the designated buyer should
issue a purchase order to the supplier that has an authorized signature and a purchase
order number. The purchase order can be electronic or written. The order form should tell
the supplier to put the purchase order number on the invoice and bill of lading. The buyer
also should send a copy of every purchase order to the accounts payable department, and
keep blank order forms secure.
3. Check all documentation before you pay the bills.
When merchandise arrives, the receiving employee should verify that the merchandise
matches the shipper's bill of lading and your purchase order. Pay special attention to
brands and quantity, and refuse any merchandise that doesn't match up or isn't suitable
for your equipment. If everything is in order, the receiving employee should send a copy
of the bill of lading to the accounts payable department. Reconcile bills for services the
same way. That is, don't pay any supplier unless the invoice has the correct purchase
order number, and the information on the invoice matches the purchase order and the bill
of lading.
4. Train the staff.
Train all staff in how to respond to telemarketers. Advise employees who are not
authorized to order supplies and services to say, "I'm not authorized to place
orders. If you want to sell us something, you must speak to ______________ and get a
purchase order." Establish a team that includes the employees who buy and receive
merchandise or services, and those who pay the bills, and develop some standard operating
"buying procedures." For example, buy only from people you know and trust. Be
skeptical of "cold" or unsolicited calls and practice saying "no" to
high pressure sales tactics. Legitimate companies don't use pressure to force a snap
decision. Finally, consider asking new suppliers to send a catalog first.
5. Report fraud.
Report office supply scams to the FTC, or your state Attorney General, local consumer
protection office or Better Business Bureau. In addition, consider sharing your
experiences with other businesses in your community to help them avoid similar rip-offs.
The FTC works for the consumer to
prevent fraudulent, deceptive and unfair business practices in the
marketplace and to provide information to help consumers spot, stop and
avoid them. To file a
complaint or to get free information
on consumer issues, visit
www.ftc.gov or
call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. The
FTC enters Internet, telemarketing, identity theft and other fraud-related
complaints into
Consumer Sentinel, a
secure, online database available to hundreds of civil and criminal law
enforcement agencies in the U.S. and abroad.
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FEDERAL TRADE COMMISSION |
FOR THE CONSUMER |
1-877-FTC-HELP |
www.ftc.gov |
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For more information about office supply
scams, order Avoiding Office Supply Scams
[PDF] from the
FTC or read it online.
March 2000
Inter-Office
Memo: Don't Get Bilked by an Office Supply Scam
We
need your help to make sure we don't become a victim to costly
office supply fraud. This is a nationwide problem affecting
businesses, churches, and fraternal and charitable
organizations; altogether, organizations like ours lose millions
of dollars to bogus office supply firms.
The Federal Trade Commission has a number of suggestions that we can follow to help us
avoid paying for goods and services that we didn't order, from labels to light bulbs,
toner to toilet paper. We need to be cautious in our dealings with telemarketers and
implement and follow good purchasing control practices. Please review and follow these
suggestions.
Get to know our designated buyers.
Our buyers are ____________ and can be reached at ____________. All purchase orders should
go through these employees. If someone calls you about ordering supplies, say, "I'm
not authorized to place orders. If you want to sell us something, you must speak to
____________ and get a purchase order." If someone calls asking for the manufacturer
and model of our copiers, refer them to our designated buyers. Be skeptical of
"cold" or unsolicited calls and practice saying "no" to high pressure
sales tactics. Legitimate companies don't use pressure to force a snap decision.
Check all documentation.
When merchandise arrives, verify that it matches the shipper's bill of lading and our
purchase order. Pay special attention to brands and quantity, and refuse any merchandise
that doesn't match up or isn't suitable for our equipment. If everything is in order, send
a copy of the bill of lading to ____________ in Accounts Payable.
Exercise our rights.
If we receive supplies or bills for services we didn't order, don't pay. Don't return the
unordered merchandise, either. If you're reasonably confident that there has not been a
legitimate mistake about the order, we can treat any unordered merchandise we receive as a
gift. It's illegal for a seller to send us bills or dunning notices for merchandise we
didn't order or ask us to send back the merchandise - even if the seller offers to pay the
shipping costs. What's more, if the seller sends us items that are different from our
order in brand, type, quantity, size, or quality - and hasn't gotten our approval first -
we may treat the substitutions as unordered merchandise. We can treat unordered services
the same way. But always consider the possibility that the seller has made an honest
mistake.
The FTC's Telemarketing Sales Rule offers us other protections in business-to-business
sales of non-durable office or cleaning supplies and most sales of goods or services to
individuals, groups or associations. According to the Rule, telemarketers must tell us
it's a sales call - and who's doing the selling - before they make their pitch. And before
we pay, they must tell us the total cost of the products or services they're offering, any
restrictions on getting or using them, and whether a sale is final or non-refundable.
- Report fraud.
If you think we've been scammed, contact ____________ in our office at . We will
report the fraud to the FTC, or our state Attorney General, local consumer protection
office or Better Business Bureau.
If you have questions about these procedures, please contact ____________ at
____________. If you'd like to learn more about business-related frauds and ways you can
help protect our organization, visit the FTC online at
www.ftc.gov. |
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