Business Directory Scams: Information? Puh-leez.
Listing your business in a directory can be an effective way to advertise the products or services you offer potential customers. But be sure you know what you’re getting for your money... and that you even asked for the listing in the first place.
The FTC recently filed a case against Your Yellow Book, Inc. (YYB), a company that marketed an online directory to businesses and nonprofit organizations nationwide. According to the FTC, YYB charged businesses nearly $500 for listings they never agreed to. They created realistic-looking invoices — even using the well-known “walking fingers” logo. Because the invoices looked so legitimate, some businesses paid them, despite never buying a listing. In all, YYB racked up over $700,000 by deceiving businesses and nonprofits with these bogus charges.
What’s more, says the FTC, actual paying clients of YYB got next to nothing for their money. Directory listings were not featured prominently in online search results. And if people found the directory website, the FTC says it was difficult to navigate. The so-called prominent placements were virtually useless to the businesses who paid for them.
If you run a small business, here are some steps you can take to protect yourself from scammers:
- Read the FTC’s information on small business scams, which outlines how con artists target businesses. Share it with your staff, including receptionists and administrative personnel, to help them spot and stop a business scammer.
- Designate a point person for office supplies, directory listings, subscriptions, and other things you buy periodically. Tell your staff that all purchasing calls should go through that person, and keep a central file of your usual suppliers.
- Use your company's social networks to educate others about the telltale signs of a business scam.
- Encourage professional associations or local business groups to issue a warning to members.
- Take a minute to share this information in your community — fraudsters often target churches and other nonprofits that depend on volunteers.
And, be sure to report business directory and other scams by filing a complaint with the FTC.