Schemes and Scams Abound in Tough Economy
by Jan Quintrall, President/CEO, BBB jquintrall@spokane.bbb.org
for the Spokesman Review, 3/29/09Have you noticed signs around Spokane about home auctions each Sunday? No phone number is listed, just a non-functional Web site.
What about the “We Buy Houses” signs stuck in medians and scattered among the campaign signs? If you ever wondered about these offers, know that the Better Business Bureau tries to stay on top of them, even though most seem to have gone out of business in the past few months. Go to
www.bbb.org and check them out.
In the current economic climate, offers in housing, credit, found money and working from home are just a few of the “interesting” focal areas at the BBB.
Housing
Back in the 1980s when I lived in Colorado Springs, Colo. – then the capital of home foreclosures – I saw all sorts of equity scams, home sales ripoffs and “sell your home by essay” offers. Well, we have one just beginning in Kootenai County. Here’s how it works:
The owners have a home and can’t sell it for what they need out of it, and so they decide to do an essay contest. They publicize the plan, letting contestants know the rules: submit a 1,500-word essay and a check for $150.
Once the owners receive 4,000 essays (or $600,000) they will turn the submission over to a college or high school class to select the best three or four. I am not clear on who makes the final decision, but one of the lucky writers then will own the home.
The owners will pay all the closing costs. When I spoke to them last week, I asked them a few important questions. Is the money going to be held in escrow? Who will have control of the money? What happens if you do not get 4,000 entries?
They assured me their attorney will handle the money and all application fees will be refunded if the magic number of 4,000 is not reached. If the plan works, they will buy another house and do the same thing with it. The owners really hope this becomes a job for them, but I’m not sure they understand that this process could take a long time, and that the costs involved probably will eat up most of the profit realized. I’m still not sure how they expect this venture to replace a regular job.
In the past I have seen these contests fail because too few people enter and the homeowner spends all the money so nobody gets a refund. I am aware that this kind of offer is used as a fundraising mechanism in many places, and I have actually seen it work – once. You just need to ask a lot of questions and be sure to verify who has control of the money. The money needs to be in an escrow account with no withdrawals.
Credit
We’ve started getting calls about offers to help you get your part of the stimulus package, or businesses being contacted by someone saying they are with Dun & Bradstreet, calling to help them improve the company credit score. The caller tells the business owner for a mere $500 they can improve their credit.
Stay away from both of these offers.
Found money
So you get a check in the mail, telling you about a prize you have won or asking you to be a super-secret shopper. There is always a request for you to put that check in your account and send part of it via a cashier’s check or Western Union.
The sneakiest one I have seen lately is the “secret shopper” scenario. They tell you not to let anyone know what you are doing when you go to wire the money because you are secretly checking out the services of Western Union.
Well, the real reason is if you tell Western Union they may try to stop you because it’s a scam. Western Union now asks all sorts of questions before you wire money because of so many scammers using the service to rip you off.
The last such letter brought to our office said they were a legitimate firm offering people ways to earn money from home and were listed with the BBB. True enough: The company has an F rating.
If you get a check in the mail and the sender wants you to send money, shred it or give it to your post office to deliver to the postal inspector and FBI.
Selling your gold
And what about cashing in and selling your gold? Everyone seems to want to help you turn that gold into cash, including a guy who set up in a hotel on Division Street in Spokane.
He spent the day looking at and buying gold, and writing people checks. Well, the checks bounced, the gold is gone and nobody can find the guy.
Work at home and other job offers
You can hardly drive around without seeing the signs. With a rough job market, the employment-related scams grow every day.
Craigslist is full of odd offers for jobs and products. Web site and classified listings are touting positions that do not exist. With the move from traditional daily newspaper classifieds to alternative forms of job listings, the screening that used to happen is gone.
Now anything goes, and that means job seekers need to be extra careful. If the “business” wants money from you, stop and check it out closely. If they want personal information before you ever set foot in the interview room, watch out: It could just be ID theft.
There are far too many offers out there just waiting to part you and your money. Educate yourself, and you will always come out ahead.
Jan Quintrall is president and CEO of the local Better Business Bureau. She can be reached at jquintrall@spokane.bbb.org or (509) 232-0530.
Good News Tends to Get Too Little Attention
by Jan Quintrall, President/CEO, BBB jquintrall@spokane.bbb.orgfor the Spokesman Review, 3/15/09Does your week sound similar in tone to the following tidbits:
•Last week, I saw a positive headline in the Wall Street Journal regarding the economy. It gave me several minutes of pause, as this so seldom happens.
•Last week, one TV reporter in our three-state service area called to talk about doing a regular feature on the worst business offenders in their area.
•Last week, BBB at the invite of the Washington State Attorney General’s Office participated in the KHQ Help Center for National Consumer Protection Week to answer calls regarding mortgage, debt and other issues affecting consumers. The calls were tough.
•Last week, BBB honored five companies in our service area for their excellence in ethical behavior (and three honorable mentions), and only one reporter called to cover it.
So when you think you’ve had enough news about the fat cat executives taking junkets while they lay off thousands, or shenanigans with financial statements, read on.
For the fourth year, BBB held the Torch Award for Marketplace Ethics ceremony at Gonzaga University. Students from Gonzaga, Washington State University and Spokane Community College worked with companies to prepare application submissions, which got them out of the classroom and into the world of business to see just what ethics look like in practice.
There are a variety of ways a business can apply:
•Designated students from participating schools seek out companies to nominate.
•The public can nominate a business.
•A company can nominate itself.
We screen all applicants at bbb.org – they must have a grade of A or B on their company report.
Four areas are reviewed by the judges: management practices, customer/vendor/employee relations, marketing and sales, and community relations.
The judges gather in January to look over the applications and select winners. This year’s judges were: Mike Metcalf, president-elect of the Spokane Chapter of Society of Financial Service Professionals; John Pederson, director of membership, Greater Spokane Valley Chamber of Commerce; Judi Williams, co-founder of Telect; Carolyn Wyatt, vice president of human resources, Yoke’s Washington Foods; Monica Hampton, store manager of Huckleberry’s Market; and Bert Caldwell, business reporter and columnist with The Spokesman-Review.
This year’s winners were:
•Roundy’s Kawasaki, Spokane Valley (1-10 employees).
•Crimson and Gray Bookstore in Pullman (11-49 employees).
•PCO, Inc in Liberty Lake (50-100 employees).
•Northwest Farm Credit Services with locations in three states (more than 100 employees).
•Big R store on Trent, Spokane Valley (part of a larger corporation).
There were three honorable mentions this year: Merlin Information Systems of Kalispell, Mont.; Moscow Food Co-Op of Moscow; and The Warehouse, a competitive athletic facility in Spokane.
Past winner, KimHotstart Manufacturing of Spokane, gave a $1,000 scholarship to the student team that produced the best overall application. That winner was PCO, Inc.
Wheatland Bank gave a $1,000 scholarship to the best video produced by a student team – the Big R Store on Trent.
Big R held barbecues with its neighbors before expanding its store to keep residents informed about the construction.
PCO has five values, including “heroic customer service.”
Northwest Farm Credit is proud of its deep knowledge of its customers – a unique relationship in these times.
And Roundy’s takes the family business a step farther to include its staff and community.
The management team at Crimson and Gray started its business when a local WSU bookstore was purchased by Barnes and Noble. Their philosophy: “We do what’s best for the students.”
Without Joel C White and Company as well as FSP, we would not have seen the success we did this year. Thanks to the students and businesses who opened their doors, and to the judges and other past winners who chose to celebrate with us.
So for some good news, view these video stories, read about the winners on our Web site and know there are some fine people doing great, ethical and successful business right in our backyard.
Jan Quintrall is president and CEO of the local Better Business Bureau. She can be reached at
jquintrall@spokane.bbb.org or (509) 232-0530.
Businesses Must Hop onto Consumer Purchase Cycle
by Jan Quintrall, President/CEO, BBB jquintrall@spokane.bbb.org for the Spokesman Review, 3/2/09Consumer habits have changed greatly in the past few years, and even more in the past six months. Last week I spent a morning with author Pete Blackshaw (“Satisfied Customers Tell Three Friends, Angry Customers Tell 3,000: Running a Business in Today’s Consumer-Driven World”) at national Better Business Bureau meetings and got an earful about the new consumer.
There is a distinct “consumer purchase cycle,” and understanding your company’s position at each point in that cycle is more important than ever:
1. Pre-shop steps: education, awareness and consideration.
2. Post-shop steps: trial, loyalty and advocacy.
How does all this translate to the real world and your customers? Let’s look at the cycle in the real-world scenario of buying a car.
Dick and Jane Doe decide it’s time to get a new car. They have no strong brand loyalty and are open to American or foreign made. They know what they like in their existing car and what they would like to have in a new car. The Does are smart shoppers and have created two lists of features: those that “would be nice,” and the “must haves.”
Next step: the Internet and the many easy-to-use Web sites that allow you to compare features. There are a number of rating sites that show reliability and resale, so Jane does some checking. She narrows the search first by features, then by reliability and safety. She and Dick sit down and review four choices.
They take off on Saturday to visit the dealers, look at the cars, conduct some test drives and check pricing. They are not comfortable buying without seeing and doubt they will actually buy online. But that is how they located the dealers they are visiting. What about that nice dealer just outside of town? With no Web site, Jane and Dick are never going to see him.
Dick and Jane have different favorites. But that is fine; they have one more pre-purchase step to take. They Google the make and model of their two favorites and check out the “chat” from people who own these cars. Are the comments favorable? It gives them a good feel for how happy owners are with the cars. That final piece of research makes the decision easy.
Now all they have to do is select the dealer. A brief visit to bbb.org makes that an easy choice.
A week later they pick up the new car and spend some time driving it around. They love the smell, the way it handles and how pretty it looks in the driveway. More important, because they conducted so much research, they know the decision was educated and sound.
Fast forward six months, and the Does have photos on their Facebook page: them, the new car, the kids and the dog. They chat with friends about how much they like this car, they reply to blogs about the car – in essence they are evangelists about what a great car this is. Leap ahead a few years. Now they have taken it in for routine service a few times and they’re performing the same kind of activity about the dealer, the service and the whole experience of this car.
Here are some basic questions to ask yourself about where your company fits in this cycle:
•Is your Web site a good “window” for potential customers to window shop? Are your hours posted? Is a map available? Is your site up to date and attractive? Would you come and see you based on the passive Web site invitation?
•Are you managing your online reputation? Have you Googled your company name lately? Do you know what your past customers say about you? Do you actively blog about your products in an informative rather than a pushy way?
•What are your competitors doing online? Are you a trendsetter or years behind others?
A friend in sales relayed a story about an antique shop in Spokane. She was talking Web sites with the owner and he said, “All my customers are older and they don’t use the Internet, so I do not need a Web site.” His wife was sitting by listening to this discussion and said simply, “Well, that pretty much guarantees at some point all your customers will be dead.” Ouch!
Your happy customers have the potential to become your best marketing tool. And the Internet gives them the conduit to make that happen. As businesspeople, we need to make sure we are on the radar in the consumers pre-shop and the post-shop phases. Start asking questions and you might be amazed at what you find.