Beware: 5 Clever Business Imposter Scams to Watch Out for in 2024

Senior looking at credit card

In the ever-evolving world of fraud, business imposter scams are becoming increasingly sophisticated, cleverly designed to dupe even the most vigilant consumers. These scams, which mimic legitimate businesses to steal money and personal information, are on a worrying rise. The Guttmacher Institute reported a startling surge in losses from $196 million in 2020 to a staggering $660 million in 2022. Charlotte Cowles, a respected finance columnist, fell victim to one such scam, losing $50,000 to a convincingly executed Amazon impersonation. Her ordeal is a stark reminder that anyone can be targeted.

Understanding Business Imposter Scams

A business imposter scam typically begins with a communication that appears to be from a well-known company—a phone call, email, text, or social media message that mirrors the real business’s branding and tone. Scammers use professional-sounding language and urgent appeals to create a false sense of security and prompt immediate action. However, the person on the other end is not an employee but a scammer poised to extract sensitive information and funds.

Berks County, Pennsylvania, USA, April 26, 2020-Amazon.com delivery person wearing gloves packages on suburban street

Common Types of Business Imposter Scams

  1. USPS and Other Delivery Services Scams: These often involve text messages (smishing) that claim an issue with a package delivery and include a fraudulent link to steal personal information. Remember, genuine courier services do not send unsolicited texts; any tracking usually requires proactive engagement from the recipient.
  2. Amazon Scams: Posing as Amazon customer service, scammers inform victims of a problem with their account, such as a frozen account due to unauthorized purchases, and request sensitive information under the guise of resolving the issue.
  3. Utility Company Scams: Here, victims receive calls threatening immediate service termination unless a payment is made through untraceable means like money transfers or gift cards. Authentic utility companies do not demand payment through these insecure methods.
  4. Subscription Renewal Scams: These emails claim your subscription has expired and offer a tempting deal to renew, leading you to a fraudulent payment page designed to capture your credit card details.
  5. Investment Imposter Scams: Scammers, posing as investment professionals, often infiltrate social media groups to promote too-good-to-be-true investment opportunities in venues like cryptocurrencies, directing victims to fake trading platforms.

Puzzled or disbelieving middle aged woman looking at the camera with a sceptical frown as she enjoys a mug of coffee

How to Protect Yourself

  • Watch for Red Flags: Be cautious of unsolicited communications, especially those that are urgent or contain poor spelling and grammar. Unfamiliar or slightly altered email addresses are a giveaway.
  • Verify Independently: Always contact the company using a verified number or email from their official website—not the contact details provided in a suspicious message.
  • Secure Your Payments: Legitimate businesses will not require payment via cryptocurrencies, gift cards, or wire transfers. Always question these payment methods.
  • Pause and Discuss: If you receive a suspicious message, discuss it with a trusted friend or family member before acting. Scammers rely on quick decisions.
  • Do Your Research: If someone claims to be from a reputable business, verify their identity through independent sources.
  • Maintain Skepticism: If an offer seems too good to be true, it probably is. Always approach unsolicited investment opportunities with caution.

Reporting Business Imposter Scams

If you suspect you’ve encountered a business imposter scam, report it immediately to the Federal Trade Commission (FTC) online or by calling 1-877-382-4357. Some businesses have their own channels for reporting fraud; for instance, Amazon has a dedicated email for reporting scams. Reporting not only aids in your protection but also helps in building a defense against these criminals, potentially saving others from becoming victims.

By staying informed and cautious, you can protect yourself from the financial and emotional damage caused by business imposter scams. Remember, in the digital age, vigilance is your first line of defense against the cunning tactics of fraudsters.