Many consumers may need to contact businesses in their areas for any number of reasons, but it's very important that when they do so, they are also sure that the company is reputable. Failing to properly verify whether a company they're contacting is legitimate can have dire negative consequences for their finances and credit scores.
There are a number of business scams out there that could end up hurting one's finances in a number of ways, and you'll need to be aware of how they might work if you're going to properly protect yourself and your family from being victimized by such a plot.
As a general rule of thumb, one thing that you should always do before contacting any business for any reason is research it online. If it has a legitimate website, strong ratings on social networks or review sites, and a good standing with the local Better Business Bureau or Chamber of Commerce, they're almost certainly going to be perfectly legitimate. But if they do not, that should raise some red flags.
It's also important for you to make sure you know some of the more common ways in which companies may try to steal your personal or financial information, which in turn could be used to put you in a difficult spot going forward.
The job scam
One extremely common type of business scam, used to gain large amounts of personal information about you that could be used for identity theft, involves a phony hiring process.
This type of scam became common nationwide during the recession, when millions were losing their jobs and slowly became desperate for work, to the point at which they would apply for just about anything that seemed to fit their professional skills. That desperation, though, was ample fodder for criminals, who would set up job listings for non-existent companies, and wait for people to contact them.
Often, there would be a phone interview, after which point the would-be worker was told that he or she was hired. All that person had to do then was fill out the right paperwork, which included requests for information including his or her name, date of birth, address and Social Security number; that's usually all the information a criminal needs to open a fraudulent account in another person's name.
Sometimes, these scams would come with an added financial twist of the knife, by these phony companies asking "applicants" to give them some money — usually $100 or so — to cover a background check, meaning that they were not only now opened up to identity theft, but had simply been ripped off for $100 they sometimes could not afford to spend.
The service scam
Of course, it's also possible that you could be contacted by bogus companies which are being more active in trying to rip you off. Many may use some sort of version of the job scam in which they say they are interested in hiring you due to your professional background, but more often they may try to obtain your financial or personal information by pretending to offer you a service.
For instance, during summer, you might hear a lot of offers from house painting services or similar home improvement companies, but not all of them are guaranteed to be legitimate. Some might be looking to rip you off for money, requiring a large up-front payment for work they have no intention of completing or possibly even starting. Others, though, might be looking for that valuable personal information, such as by offering a service that itself requires an application process. In some cases, these may involve the criminal posing as a worker for a well-known company, either by phone or in person, and asking you to "verify" information that no legitimate company would ever actually ask you for.
In general, a good rule of thumb in this regard is that companies will typically not contact you and ask for personal or financial information completely out of the blue. These calls or visits may be precipitated by your having contacted that company, but unsolicited requests for information should set off a number of alarm bells for you, and tell you that you should not, under any circumstances, have any further dealings with those people, even if they claim to represent legitimate or well-known companies.
When you're trying to protect your finances overall, though, it's also important to keep a close eye on your credit reports, ordering them regularly and checking them over for any potentially unfair markings that may exist. If any such entries are discovered, it can be wise to contact a credit repair law firm, as this may allow them to get the issues cleared up more quickly than they might have been able to accomplish on their own.