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ABA Family Legal Guide

Forming and Operating a Small Business

Business Problems

Small Business Scams

What steps can I take to avoid being scammed?

The Better Business Bureau offers numerous advisory publications on scams against businesses on its website, www.bbb.org. American Express's Small Business Service also offers warnings against scams, especially for start-up/ home-based businesses. Here are a few tips that might help you avoid getting fleeced.

  • Don't make commitments to people you don't know--especially over the telephone.
  • Do conduct business with individuals and organizations you know.
  • Do insist that all sales pitches, charitable appeals, and advertising propositions be sent in writing.
  • Don't agree to advertise in a publication without verifiable circulation figures, sample copies, publication dates, and the name of the publisher.
  • Do keep an approved list of publications in which your advertisements appear, so employees won't fall for the claim that your company has advertised in the salesperson's publication before.
  • Don't pay invoices that can't be matched with a purchase order.
  • Do centralize authority for supply and repair orders.
  • Don't contribute to charities without the full name, address, and purpose of the charity, along with the latest financial statements indicating that most of the money collected actually goes to the work of the charity.
  • Do issue charitable contribution checks to the charity itself, rather than an individual solicitor.
  • Don't order supplies from an unknown supplier without first comparing prices and quality with known suppliers.
    • American Bar Association Family Legal Guide
    Copyright © 2004 American Bar Association
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