How scammers extort money from new businesses

Service Business

If you are just setting up a company, you may fall victim to fraudulent fees for its registration. Learn about the actions of scammers to know how to protect yourself from them.

Fraudsters have been extorting money from startups for many years. Although they use different methods, their goal is the same - to obtain a fee from the trader for registering his business. Extortion attempts are usually made within a few weeks or months of starting a new business.

Online scams

Fraudsters operate through traditional mail, but also electronically. They extort money from entrepreneurs online in two ways. The first one is sending an e-mail to the owner of a new company with information about an entry in the register or directory of companies, along with the associated fee. Although the message contains information about an optional fee, it is most often given in "small print", so most recipients do not notice it. The scammers are based on the ignorance of young entrepreneurs who think that such registration and payment is mandatory.

The second way is information about creating an account and entry into an allegedly free company directory. After a few months of operation of such a website and adding more new businesses to it, the scammers change its regulations. Changes to entries introduce fees for entry without the possibility of resigning from having an account on the website before paying the fee. As an explanation of their actions, they provide paragraphs of the previous version of the regulations, which informed about possible future modifications, including the introduction of fees. Here, the fraudsters rely primarily on inattention - hardly any of the young entrepreneurs read the regulations of all websites that contact them. Those who ignore this type of e-mail about changes to the regulations and do not pay fees can expect further messages - this time informing about the referral of the case for debt collection or legal action, which of course is another attempt at extortion.

How to protect yourself from the actions of Internet fraudsters? First of all, you should ignore all messages related to entries in online registries, and above all those requiring any fees. Adding your business to such a directory should always be voluntary and independent. When we choose the right service ourselves, we check it and only then register the company's account in it, we will avoid the actions of fraudsters.

For the clerk

There are also people who extort money using traditional correspondence. Their methods are even more effective than those of Internet scammers.

In this case, the entrepreneur receives the letter by mail. The document resembles those sent by offices and institutions. Fraudsters give names to company registers similar to those that function officially, e.g. to the Central Register and Information on Economic Activity. The new entrepreneur does not notice a slight difference in the name or does not expect a trick, recognizes that such a register apparently also works. In this way, it falls into the trap of fraudsters.

In this way, money has already been extorted from many entrepreneurs, not only from new ones, but also from people who have been running their businesses for years.

Legal extortion

Unfortunately, many of the methods used by fraudsters are not illegal. Most letters sent to entrepreneurs, either by e-mail or by traditional mail, inform about an optional fee for entry. This entry is often added in a smaller font at the end of an email or letter. The fact that it is there, however, makes the entry in the register created by fraudsters optional. On the other hand, the law allows for the creation of voluntary lists and catalogs of an informative and promotional nature, even if they are payable.

In some situations, however, scammers go one step too far. This happens when, in order to add credibility to their writings, they forge the names and emblems of institutions, offices and courts. This is already a violation of the law and allows legal action to be taken against fraudsters.

Tadeusz Bisewski

An expert from Mala-Firma.pl - everything about setting up a company