Magazine article Business Credit

Warning, This Transaction May Be Dangerous to Your Company's Health

Magazine article Business Credit

Warning, This Transaction May Be Dangerous to Your Company's Health

Article excerpt

Unsolicited Orders: Are they too easy to be true'? Normally, sales reps have to work to get an account; care should be excercised when it's the other way around.

Rush Orders: Con men often attempt to force a shipment without a thorough credit check, or attempt to play sales against credit, soliciting a response such as, "If we don't extend credit, we'll lose the sale," from the credit department.

Phony References: The reference is one of the foundations of the credit extension process, so the crook will sometimes set up his/her own references. Question the following.

-Overly glowing reports from the reference. -References all coming from the same geographic area. -References that have impressive sounding names, for example, International, National, American, or Liquidators. -Reference's phone answered with something other than the reference business name. -Reference's phone answered by a machine or service.

Same Name Scam (Business name is confusingly similar to another, wellestablished business.): This is one of the most difficult to spot. Attention to detail is the key. Make sure order-entry personnel ask for full spelling and address of subject, and pay attention to new ship-to addresses.

Abnormal Number of Credit Inquiries: Legitimate trade or bank references often report an abnormal number of credit inquiries relative to their volume of business with a prospective customer. The problem is that, when checking referances, few companies ask about the number of inquires, and when the information is volunteered, the individual taking the credit information down for the inquiring company often fails to make a note of it. …

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