Small businesses targeted in magazine ad scam

Published On: Nov 07 2012 08:34:12 PM EST
Updated On: Nov 08 2012 07:45:00 AM EST

United States Postal Inspectors have a warning for small business owners.  Authorities say con men are targeting them in a magazine ad scam, and in one particular case, admitted it.

“The defendant told us they were just taking the money,” said Inspector George Clark.

Clark says in this case, the victim gave the con men money in exchange for ad space in what was called a 'Public Safety Magazine'.   But this so-called magazine turned out to be a few colored pieces of paper stapled together.

“They would tell whoever answered the phone at the small business that they had already agreed to place an ad they were simply calling to confirm that the business was prepared to pay [for the ad], “ said Clark.

While sometimes the magazine would be a pile of paper, most of the time there was no magazine at all.

“In the early part of the operation they were publishing magazines but by the time we started our investigation we don't think any magazines were being published," Clark added.

Postal inspectors discovered both suspects had a history of telemarketing schemes.  In this particular case, they both admitted their guilt.

“These guys made about $1.5 million in the last five years...but since these guys have been doing telemarketing schemes in way or another in their adult life I would say it's a safe bet they have made 5 million dollars in the last 15-20 years,” said Clark.

Small business owners need to remember before you pay for an ad or a service, make sure you're getting what you're paying for. Check out the business you're dealing with before you pay.   And as part of your research, check the internet.

“Get the name of their business - get the name of the publications - Google them; you'll be surprised how much you'll find,” suggested Clark.

In this case, one con man was sentenced to two years in prison and the other was sentenced to five years.

We did a little digging and found an interesting article which highlighted common scams where small businesses are targeted.  One scam involved invoices that were sent to a business for unordered products, in the hopes the phony invoices would be paid without a second look.  Experts say to avoid this, businesses need to have a system in place to review all invoices and compare them to expense records to make sure they are legitimate.

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