Website Woes: Avoiding Web Service Scams
If you're interested in using the Web to expand your small
business, be cautious. Some unscrupulous companies, claiming to
provide free web design and hosting services, are billing small
businesses for services that were never authorized and have
little value. The bogus charges usually appear on businesses'
phone bills - an illegal practice known as "cramming" -
or on fraudulent invoices.
The Scam
You get a call from a company offering you a free, 30-day
website. They say you can continue the service for a nominal fee,
say $25 or $30 a month, and cancel at any time. Some service
providers state that you'll be billed automatically after the
30-day period; others claim you won't be billed after the 30 days
unless you tell them you want to continue the service.
Before or after explaining the offer, the provider asks for
basic information about your company: the address, contact
person, business hours and a brief description of the business.
The provider says that your free website will be up and running
within a week, and that you'll receive a welcome package, which
may include a printed copy of the website, instructions for
accessing the site, and a phone number to call to make changes or
cancel the service.
In fact, unscrupulous service providers bill you, whether you
authorize the services or tell the provider that you want to
cancel. Also, many of the services have little value. That's
because these providers design and host sites that contain
limited information about the business, include misinformation or
misspellings, and lack important features. Moreover, most of the
sites are not listed with major search engines. If customers
can't find your site, it's worthless to your bottom line. In
addition, you probably won't see the welcome package, but you
will see the bill - either on your phone bill or as a direct
invoice.
Unless you review your monthly phone bills or invoices
carefully you could end up paying unauthorized charges for months
before you notice the scam.
Protect Your Business
You can protect your business from losing money to unordered
services. Here's how:
- Know your rights. If you receive bills for services you
didn't order, don't pay. The law allows you to treat
unordered services as a gift.
- Review your phone bills as soon as they arrive. Be on the
lookout for charges for services you haven't ordered or
authorized. If you find an error on your bill, follow the
instructions on your statement.
- Assign purchasing to designated staff. And document all
your purchases.
- Train your staff in how to respond to telemarketers.
Advise employees who are not authorized to order services
to say, "I'm not authorized to place orders. If you
want to offer or sell us something, you must speak to
______________."
- Buy from people you know and trust. Authorized employees
should be skeptical of "cold" or unsolicited
calls and feel comfortable saying "no" to high
pressure sales tactics.
Where to Complain
You also may want to share your experiences with other small
businesses in your community to help them avoid a rip-off.
The Better Business Bureau also may be able to help you with
your problem. You can file a complaint with the BBB by using the
online complaint form or by contacting the local BBB in your
community.
This Business Alert was produced in cooperation with the Small
Business Administration, American Chamber of Commerce Executives,
Better Business Bureau, National Federation of Independent
Businesses and Yellow Pages Publishers Association. For more
information that may be helpful to your small business, contact
any of these organizations.
American Chamber of Commerce Executives
4232 King Street
Alexandria, VA 22302
Better Business Bureau
Contact your local BBB; look for the phone number in your
telephone directory or contact the Council of Better
Business Bureaus, Inc.
4200 Wilson Boulevard, Suite 800
Arlington, VA 22203-1804
National Federation of Independent Businesses
53 Century Boulevard, Suite 300
Nashville, TN 37214
1-800-NFIB NOW
Small Business Administration Answer Desk
1-800-U-ASK-SBA (1-800-827-5722)
Yellow Pages Publishers Association
3773 Cherry Creek North Drive, Suite 920
Denver, CO 80209