BBB® warns businesses: Beware scammers exploiting BP oil spill

By: Press Release
By: Press Release
Disaster provides many opportunities for scammers to prey on business community

The Associated Press
Oil cleanup workers hired by BP make an effort to clean the shore in Orange Beach, Ala., on Saturday. Large amounts of the oil battered the Alabama coast, leaving deposits of the slick mess some 4-inches thick on the beach in some parts.

Pensacola, Fla. (June 25, 2010) – The Deepwater Horizon oil spill continues to threaten the environmental and economic health of the Gulf Coast.

However, your Better Business Bureau Serving Northwest Florida warns businesses to beware another potentially damaging byproduct from the oil spill: scammers looking to take advantage of the disaster.

“Unfortunately, history has shown that scammers follow the headlines,” said Norman Wright, president and CEO of your BBB. “In the wake of a national disaster scammers will find a way to prey on the misfortune of others.”

While this list is by no means exhaustive, your BBB warns of some common scams that may target businesses in the wake of the BP oil spill disaster:

 Loan scams: Economic Injury Disaster Loans are now available through the U.S. Small Business Administration and interest-free Bridge Loans are available for businesses in the state of Florida who can show documented or anticipated losses. In addition, some local banks and credit unions are offering low-interest disaster loans as well. However, your BBB warns that loan scams often surge in the wake of a disaster.

o Beware of loan brokers who promise that you are “guaranteed” a loan if you pay an up-front fee. Advance fee loans are illegal in the state of Florida.

o Be leery of those who promise that bad credit will not stand in the way of a loan. Those who say “you deserve a loan” or “no hassle – guaranteed” are generally scammers.

o Be on the lookout for sound-alike names. Crooks may use a name similar to a well-known or respected organization and create slick websites to trick you into providing sensitive financial information or to steal your hard-earned cash.

o Walk away from a lender who asks you to wire money or pay an individual. Legitimate lenders don’t pressure you to wire funds or to pay a “courier” instead of the institution directly.

o Don’t be bullied by scammers who allege that you will be issued a “forfeiture letter” that would make your small business ineligible for any SBA funding for three years if the small business refused to use the firm’s services. SBA has issued warnings against these frauds in previous disasters.

 Claims scams: BP is evaluating claims for property damage, loss of income and bodily injury. ESIS, BP’s authorized claims administrator does not charge individuals or businesses any fee to process claims.

o Your BBB warns that scam artists may pose as authorized adjusters and request fees in exchange for filing or processing your claim.

o Other scammers may position themselves as negotiators who will get claims expedited in exchange for a fee.

o Still other anticipated scams involve individuals fraudulently pretending to be government officials demanding payment to process applications for government assistance.

 Contractor scams: As damages from the Deepwater Horizon spill become more apparent, businesses may need to hire a contractor for cleanup or repair work.

o Your BBB warns against doing business with contractors who require payment-in-full up front. You could be out the money if they fail to perform the work or to finish the job to your satisfaction or to pass inspection.

o Beware contractors who don’t offer a written contract or offer a contract with blank lines next to critical details.

o Walk away from contractors who want you to pull the permits for work to be done. They likely are not properly licensed and if the contractor fails to perform the work adequately, you could be responsible for the work necessary for the project to pass inspection.

o Verify licensing and insurance for all contractors to ensure it is current.


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