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Supplier Scams

Learn about how to identify, avoid, and report supplier scams.

Higher education institutions are experiencing an unprecedented amount of fraud attempts. These attempts, as expressed by the FBI, take multiple forms; including the issuance of fraudulent purchase orders, supplier impersonation (also referred to as supplier imposter fraud) and various forms of phishing schemes. We ask that you beware and practice diligence as you conduct your business practices.

Report a scam

Identify a scam

Fraudsters are typically in tune with the type of business their victim’s conduct, which is why being aware of the following schemes can help prevent fraud.

  • Purchase order scams. This type of fraud includes a perpetrator placing a fake purchasing request and issuing a purchase order on an entities' behalf. The purchase order typically looks identical to that of the known company. The purchasing request is placed and the delivery of goods is sent to a fraudster’s location.
  • Supplier imposter fraud. This can take many forms, but most recently we have experienced this form of fraud attempt within the disbursement of payment. Fraudsters are impersonating legitimate suppliers and requesting changes to their payment details. Given the spike in this form of fraud, UC San Diego is transitioning all in-house managed direct deposit to our trusted third-party partners. Refer to UC San Diego’s Payment Strategy to learn more about our secure payment offerings.
  • Phishing schemes include elaborate emails sent by perpetrators requesting sensitive information or submitting requests that are out of character or against policy.

Helpful tips:

  • Use your best judgement and follow your instincts. If something about your business transaction does not feel right, it probably is not right.
  • Conduct an independent verification of the request. If the request is legitimate, the supplier should not mind you returning their phone call using an independently obtained phone number.
  • Fraudsters typically have urgency in their requests. If a request seems too urgent, stop and question it.
  • If the price is too good to be true, it probably is.
    • Supplier scams assume that you don't compare prices or check your invoices. In a recent incident, a scam supplier attempted to sell a UC San Diego department copier toner valued at $25 for over $600 with shipping and handling costs.
    • Do not fall for unreasonable discounts. There are usually hidden costs involved.
  • Be aware of the "sales pitch." Here are some common examples:
    • "We're raising prices and have several cartons at the old price."
    • "We're selling discontinued items at close-out prices."
    • "This is a call on behalf of [department's usual supplier]."
    • "We have free items or gifts for ordering."
    • "You must order today to take advantage of the price."
    • "We're a function of your service agreement."
  • Other sure-fire ways to identify a scam:
    • Scammers typically will not give their full names or provide telephone numbers.
    • The company's name is similar to your normal supplier's name.
    • They typically will not send you a quote, or anything in writing.
    • Scammers ask for your Social Security number or credit card number so you can qualify, or to identify your purchase.

Prevention

Don't be a victim. You can guard against supplier scams by using the following guidelines:

  • Allow only designated department buyers to place orders.
  • Use only known companies — or ask for references.
  • Review email addresses thoroughly. Does the e-mail domain make sense?
  • Do not give any information about your business operations over the phone or via e-mail to unfamiliar suppliers.
  • Do not respond to unsolicited e-mails from unfamiliar suppliers.
  • Never place an order via e-mail to a supplier you don't know.
  • Return or refuse all items received from an apparent scam.
  • Do not authorize payment for transactions you believe to be scams. 

Resources

Note: this page has a friendly link that's easy to remember: http://blink.ucsd.edu/go/scams