Teach your users to recognize the 'phoner toner' scam

Con artists are costing IT enterprises a bundle every year. Make your company scam-resistant by alerting your users to common IT scams, such as the "phoner toner," which preys on untrained employees with slick talk and promises of low, low prices.

Recently, a company I do consulting work for circulated an e-mail warning about a common telemarketing scam that hustles employees into buying vastly overpriced office supplies. This company had already fallen victim to this scam once before; but this time, an alert employee recognized the phony call and sounded the alert. Unfortunately, while this company is now able to avoid the scam, the con artists will no doubt be moving on to other less wary enterprises.

This scam is one that law enforcement officials have dubbed the “phoner toner.” Basically, a telemarketer calls employees and fast-talks them into buying toner or other supplies at a “discount.” The resulting invoice, however, proves to be no bargain. The Federal Trade Commission’s (FTC) Bureau of Consumer Protection recommends training as one of the first lines of defense against this sort of fraud. In this article, we’ll describe the “phoner toner” scam and outline how to alert your users to the danger.

The scam
The “phoner toner” scam usually involves a series of phone calls. In the first set, the caller hopes to find a new employee, temp, or person who will freely give information. Posing as the company’s vendor or perhaps as a survey taker, the caller asks the employee to read the make and model number off the nearest printer. Faced with such a harmless-seeming request—and not realizing a legitimate vendor would probably know the information already—the employee complies.

The bite comes a little later. Again posing as a vendor or a representative of a warehouse, the scam artist contacts someone in the company. If it’s the same employee, he or she may be reminded of the earlier conversation as if the hustler was an old friend. The employee hears about a tempting offer on toner cartridges that just happen to fit his or her printer. (The actual component, of course, can vary, but toner is common.)

Naturally, there’s a limited supply, or a limited time, so the employee is pressured to agree to have a case or two sent out. Again, the caller may strive to make it seem that he or she is already an approved vendor and just needs a verbal agreement to authorize the sale.

The resulting delivery contains the surprise. Perhaps it’s cut-rate toner sold at a name-brand price. Perhaps a “case” of cartridges contains far fewer units than expected. Or you could discover that the wonderful per-unit charge you were quoted referred to individual cartridges, not cases. In any case, the company is overcharged for the product. In the most egregious instances, companies receive invoices for products they never ordered or even received.

If someone complains, the scammers might resort to bluster, contending that the invoice is legitimate and that failure to pay could result in a lawsuit or worse. Or they might pretend that the salesperson “forgot” about a discount and offer the cartridges for a reduced—but still highly profitable—price.

The FTC estimates that scams cost legitimate toner vendors $100 million in retail sales and victims up to twice that sum yearly. But authorities have scored some victories against “phoner toner” fraudsters. In one case, the FTC secured a $2 million settlement against a single company accused of running the scam.

What your employees should know
Although the FTC’s “Operation Misprint” seeks to crack down on telemarketing fraud, the agency recommends employee education as one of the first lines of defense. New employees should understand who is authorized to make purchases and know to avoid revealing any information about the company’s information technology (always a wise practice), even if the caller seems to be familiar with the company or other employees.

Meanwhile, don’t wait for a report of a phoner toner call to train your employees to handle the scam. You can describe the practice as an aside during a training session or as a short e-mail. This article on the FTC’s Web site even provides a sample interoffice memo you can e-mail to your employees.

The FTC also recommends these tips for protecting your company against scams:
  • If you receive bills for goods or services that you didn't order, you’re not obligated to pay, even if the product was already delivered.
  • Inspect your bills and be sure they correspond with the goods and services you’ve ordered and the prices you were quoted. Do the same when you receive the shipment.
  • Assign purchasing to designated employees. Verify documentation for all purchases.
  • Train employees who are not authorized to order goods and services to clearly say so, and to direct the caller to the authorized personnel.
  • Be skeptical of "cold" or unsolicited calls; recognize and resist high-pressure sales tactics.
  • If you suspect an office supply scam, report it to the FTC, the State Attorney General's office, or the Better Business Bureau.

Often, companies use preferred vendors. When appropriate, informing employees about the vendors you use can deter a phony vendor from bamboozling an unsuspecting worker. Encourage your employees to report questionable contacts—when callers fail with one employee, they often move on to another.

Again, you should be sure your employees know never to disclose information about your information systems. While it’s common sense not to disclose passwords, network addresses, and the like, telemarketing fraudsters go to great lengths to appear friendly, nonthreatening, and familiar with your company—just like a legitimate vendor would be. Yet even knowing a printer’s make and model can enable a scam artist to overcharge the company to the tune of thousands of dollars.

FTC resources
If your business falls victim to the “phoner toner” scam, you should report the fraud to the FTC. To file a complaint, call toll free, 877-FTC-HELP (877-382-4357), or use this online complaint form. The FTC enters complaints regarding telemarketing, Internet scams, identity theft, and other fraud into an online database called Consumer Sentinel, which is available to civil and criminal law enforcement agencies both in the United States and abroad. The FTC’s Web site also contains a number of articles that can educate the public about common deceptive practices. In addition, the National Fraud Information Center can be reached toll free at 800-876-7060.

The sting
Has your company been a victim of an IT-related scam? Share your story with your peers by posting a comment below or by dropping us a note.