If it sounds too good to be true, it probably is.
That's a lesson Melinda Douglas said she learned after falling for a marketing scheme involving her purchase of bad sales leads. Upon investigating further, Douglas, the owner of home care company Healthcare Solutions, discovered that the person who sold her the leads was a convicted felon, one who has previously victimized other businesses.
“I passed off … my monies spent as a ‘stupid tax,’ as small business owners often fall prey to individuals such as this one,” Douglas says. She notified HomeCare and other organizations about the incident in the hope that, armed with her knowledge, fellow providers might avoid being taken.
Douglas' experience is just the latest in a series of disturbing alerts about business scams directed at HME suppliers.
Earlier this year in a scheme that turned up in Florida, unscrupulous buyers were said to be offering large sums of money to purchase small HMEs in deals that required the sellers to keep their supplier number active for a period of time after the transaction close. The buyer then used the number to bill Medicare for fraudulent claims up to a certain amount before shuttering the business.
In July, we learned that the now-familiar e-mails involving a Nigerian prince who promises great rewards in exchange for a small payment have morphed into international telephone scams. In this twist of the “419” scheme — named after the penal code that prohibits such acivities in Nigeria — the scammers call into HME companies using TTY lines for the hearing impaired (making their calls untraceable) to request that DME be sent on an urgent basis to a foreign address, often in Nigeria. According to the Secret Service, the equipment probably ends up on the black market, and the home care companies that sold it are left with responsibility at the bank for the credit card charges the phony buyers rack up.
For many providers these days, wondering about the future of the industry — and what their individual roles in it will be — are top-of-mind questions, and they are compelling questions to be sure. But along with the larger issues that face them, HME owners must never take their eyes off the company back door, authorities warn. To protect against the growing variety of illegal schemes, the National Fraud Information Center (www.fraud.org) advises doing business with companies you know and trust. If you don't know the company, you should check it out. The organization also cautions that you should understand the offer and get details in writing, guard your financial information and educate employees about avoiding scams.
While scams may not have as great an impact on your company as any changes that politicians and regulators might implement, the increasingly inventive con artists that target small businesses can take a painful bite out of your bottom line.
For more advice on recognizing business scams, check with the Better Business Bureau at www.bbb.org; the Federal Trade Commission at www.ftc.gov; and the Small Business Administration at www.sba.gov. Report business scams to your state attorney general.
