Fraud is a growing problem not just in the trucking and logistics industry but all industries alike, and after our third attempt at being scammed this year, we decided it was time to share what we’ve learned with our valued customers, colleagues and fellow businesses across all sectors.
Why? Because it’s so easy to be scammed, and for small to mid-size companies, it can be devastating. In 2022, we lost $20,000 in shipping costs due to fraud—an expensive and frustrating lesson. Since then, we’ve done the research, consulted our network, and put safeguards in place to prevent it from happening again.
Now, when fraud attempts come our way (which happens more often than you’d think), we spot them quickly and avoid falling victim. In fact, just two days ago, we caught another one. The good news? With the right process, fraud is often easy to detect.
Our Standard Operating Procedure for Credit Checks
To protect our business and yours, here’s what we do before extending credit to a new company:
1. Verify Business Information
✔ Collect and review a credit application form
✔ Research the business using credit check platforms
2. Check Email Domains & Website Legitimacy
✔ Use domain lookup tools like:
-
- Whois.com
✔ Red Flags:
❌ Domains registered within the last 6 months
❌ Mismatched email & website domains (e.g., [email protected] for a company claiming to be XYZ Freight or [email protected] vs [email protected] – the real life example that we fell for)
❌ Websites with missing or inconsistent contact info
❌ Phone numbers that don’t match the business location’s area code
- Whois.com
3. Research Company & Contacts
✔ Google names provided on the credit application
✔ Check for a LinkedIn profile that matches the business and title
✔ Look for other online info to confirm legitimacy
4. Call References
✔ Verify the relationship with the provided references
✔ Confirm that the customer’s contact number matches the vendor reference’s records
5. Trust your instinct
Let’s take a look at the most recent attempt: Application here.
Tim Collins
Purchasing Manager
Sonic Drive In
300 JOHNNY BENCH DR SUITE 400
OKLAHOMA CITY, OK 73104
Tel: 858-333-3066
Email: [email protected]
Right off the bat you can see that the URL is different than the one used by the real Sonic (sonicdrivein.com). There is no website associated with sonicdriveinstores.com. After a quick Google search, you can see “Tim Collins” is a common name (my favorite is when they use the name of someone famous), but none are associated with Sonic restaurant. Sonic provides an 866 number on their website and is in a 405 area code at its headquarters, not 858, which is in San Diego, CA—though it would make sense for a scammer in that area to reach out to a California trucking company to defraud.
The credit application is one of the more blatantly fraudulent ones we’ve seen, but let’s point out the obvious. It’s incomplete and incorrectly filled out. Phone numbers have extra digits and are clearly made up. There is no bank by the name “Bank Financial.” None of the URLs following the names of the individuals listed are valid. The person named as a credit reference is also the name used to sign the application. They use the same last name multiple times, and we could go on and on.
Now that you know what to look for, do you see all the other issues with this application too? We hope this helped even one company not fall victim.
By following these steps, we’ve stopped fraud in its tracks and saved ourselves from financial loss. If you’re extending credit, take the time to verify who you’re doing business with. It could save you thousands!
Stay vigilant and protect your business. If you’ve had similar experiences, we’d love to hear how you safeguard your company against fraud too. We can all help each other so much!
📞 Have questions or want to learn more? Contact us today – we’re so happy to help!