Tips to Avoid Fraud

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Fraud is especially easy on the Internet. Scam artists can set up websites, post messages on trade boards, and send unsolicited email to your business. How do you judge the fraud？How do you minimize the risks of business fraud?Here are some tips for your reference:

1. Get customer, supplier, and bank references for all new business contacts. Face to face contact is needed.

2. Be sure you have a verifiable physical address for the company.

3. Be careful of anyone using a free e-mail account. These accounts can be opened without a credit card. If a person is legit, they will gladly send you their company e-mail address such as name@company.com

4. Verify telephone numbers by using directory assistance, telephone books, and online directories.

5. If possible, make purchases directly from the company that holds the trademark, copyright or patent for an item.

6. Never pay for products upfront.

7. Never extend credit to new business customers.

8. Much foreign trade is done with a Letter of Credit. Don‘t ship goods until you have received an Irrevocable Letter of Credit, confirmed by your bank.

9. Make sure your bank is one of the top 100 international banks.

10. Make sure that bank drafts have cleared before you ship merchandize.

11. Verify credit card information through Visa, MasterCard, or AMEX. Check with the bank that issued the credit card to be sure that the card has not been reported stolen. Get the three-digit security code on the back of the card. Have a signed credit card authorization faxed to you.

12. Hire an independent agent to control the shipment of goods to you. Get a third party certificate prior to shipment. That way, you are guaranteed full shipment.

13. Never send free samples. Insist on payment, including shipping & handling costs.

14. Check with the Better Business Bureau to see if there are complaints lodged against the company.

15. Make purchases from reputable companies who are willing to supply you with the following information:

·         Business license, broker license, or contractor license number

·         Name of their bank, so you can check account references

·         State agencies they are registered with

·         Membership in associations (AMA,ABA, etc.) 

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