In today’s world, scams abound.

According to the Competition Bureau, Canadians lost $40 million in 2016 in online scams and small businesses are not exempt as targets. Within weeks of launching his website, and opening the doors of his design shop to the public, Thomas Hart, owner of Hart & Hive, experienced his first scam attempt and wants to warn other small businesses that they need to stay vigilant to avoid becoming a victim.

Scams generally come in the form of a prospective sale. As a new business, you are keen to make any sale you can and don’t want to ignore what could be a legitimate customer. However, letting your eagerness interfere with your judgement could put you in a situation you wouldn’t want to be in.

“About two months into launching, I got an email requesting to purchase a gold necklace, and after sending photos of what we had to offer, he picked four he liked and asked for two of each of them then requested if I had any gold bracelets,” says Thomas.

He continues: “When I asked what style he was seeking, his response was ‘anything gold’, which raised a red flag for me. How could he not care what it looked like? The prospect of what would have been a $4000 order kept me hoping this was for real, but when he wanted the items shipped directly to his ‘son’ in the US, another red flag was raised.”

He says the prospect only wanted to communicate through email or text message and when he tried to call the number, it was revealed that he was using an internet-based texting service, not an actual phone.

“Once I was given a credit card number to process the transaction, I immediately called the issuing bank and it turned out he was using a stolen card,” says Thomas.

On top of that, he was told that could have been held liable for the money anyway if he had not been sufficiently prudent in his attempt to spot the scam.

Starting a new business is already stressful and financially taxing, and having scam attempts come at you right at the start is something you might not be able to afford to recover from.

At Hart & Hive, these are red flags we look out for, as sometimes they mean a scam is in progress:

  1. Customers who only communicate via email.
  2. Customers in an unreasonable rush to have you ship the items to them.
  3. Lengthy email addresses that appear to be random words, letters or symbols or that don’t match where the buyer claims to work or live.
  4. Customers who insist on making payments outside of the official methods you offer.
  5. Orders that are to be shipped to an address in a different province, state or country then the credit card’s billing address.
  6. Customers who show little concern for the details of a high-value product.
  7. Customers who are unaware of their credit cards daily or monthly limit.

Lastly, to ensure you are covered in situations similar to this one, confirm the payment has been fully processed before shipping items, and call the card’s issuing bank to verify the customer’s details should there be any concerns about the legitimacy of the transaction.

Don’t get caught up in the excitement of a big sale and forget to think if everything really makes sense.

Written by: Thomas Hart, Owner of Hart & Hive, Guest Blogger


About Thomas Hart

Thomas Hart is an industrial designer and entrepreneur who is currently operating his second small business, a design studio and store called Hart & Hive located at 353 College Street in Toronto, ON. Thomas is available for comment, quotations, or clarification at the following contacts:

Cell: 416.993.0815

Business: 647.812.1022


Get up to $60,000
in financial support,
and the support of one
of our 2,400+ mentors.

Learn More →