Avoiding Online Scams for New Web-based Business Owners

When you're new to running a business there are a lot of people who will try to take advantage of you. Avoiding scams is a crucial skill for new business owners and employees of small businesses. Most of these scams rely on a kind of social engineering where the scammer will pretend to be someone they're not in order to get information about you, money from you or to just plain hack your website. Here's a list of common scams on new web-based businesses and how you can avoid them.

Avoiding Domain Scams

This is probably the one I've seen the most. There are three kinds of domain scams that I've seen. The first is domain squatting. This is when a scammer purchases domains that they think are valuable or could be valuable. Then when you try to register the domain you have to purchase it from them and they usually charge around $5,000 for a $20 domain. If your business or product was around before the scammer purchased that domain, you have a legal right to it and can go through the right channels to get the domain given to you.The second scam I've seen is similar to this. The scammer will offer to sell you domains that you probably don't want and don't need for hundreds or even thousands of dollars. Just don't respond to them. The third scam is a lot more nefarious. The scammers will contact you, probably through regular mail, and claim that your domain is expiring soon or that a domain name similar to yours is available or expiring or that there is some kind of bidding war going on. Rest assured that your domain names will never prematurely expire and that these people can't touch them without your permission. You should never respond to any of these people unless you're trying to claim a domain that properly belongs to you. Any kind of contact suggests to them that you are a vulnerable target and they will continue to harass you. Just ignore them. If you think a claim might be legitimate, call your domain registrar or website host directly and ask them for their advice.

Avoiding Phishing Scams

Phishing is when a scammer pretends to be someone they're not in order to get information from you. This will usually occur in the form of an email coming from a company like PayPal or your bank. Phishing emails look like they come from legitimate companies but you can usually spot them by how they come from a strange-sounding address like "account-inquiries@paypal-payments-3.co.uk" (This address seems strange because there's a lot of hyphens, a number and the TLD[the end part] is not a .com). They also tend to ask you for information about your account. This part is important:

NEVER REPLY TO AN EMAIL THAT ASKS YOU FOR ACCOUNT INFORMATION. NEVER. NEVER EVER. DON'T DO IT.

Phishing emails will ask you to confirm your username, your password, the last four numbers of your credit card, your address and any other kind of information they can use to get access to your account. never give anyone or any email any information about you or your accounts. It's unsafe and will always end badly for you.

Avoiding Trademark Scams

This one is interesting. In this scam, the person attempting to scam you will tell you that your trademark on something is contested or that it's not valid in a certain region or that it doesn't exist for whatever reason. This is very similar to the other scams. In this one, if you reply, the scammer will insist yo pay them large amounts of money in order to keep your trademarks. Your trademarks are never in danger though. The only people who can revoke them are the authorities that granted them.

Avoid Credit Cards

Just plain avoid them. These aren't scams in the traditional sense but they're not great for you. Credit cards will give you more financial flexibility but when it comes down to it, you still have to pay back that money plus interest. Any action where you're losing money like that is not a good business decision. If you do have credit cards, make sure they're in your company's name and that your company is an LLC or other limited-liability structure. If your business goes under, you don't want to get stiffed with thousands of dollars of credit debt. I've had it and it's not fun to deal with.

Avoiding Service Scams

As a business owner, other service providers will constantly come to you and offer you services you don't want or need. People will offer to do business evaluations, rebrand your cross market synergies and all sorts of real and bogus things that you just don't need. If you don't understand exactly what a service is and they can't explain it well, it's a scam. Some service scams are actually useful things but they want to charge you a lot of money for them. Like SEO or Search Engine Optimization. This is a very useful technique for making sure people are finding you in search results. However, it's not worth $60,000. You can probably do a lot of SEO on your own over the course of just a few days using google to learn as you go. If you think you actually need some SEO work done or you want a good opinion on it, I would strongly recommend you contact Yoast. This guy is the best in the business and maintains one of the best and most popular WordPress SEO Plugins.

The same goes for redesigns. Companies will offer to redesign your website for free, for cheap, for only if you host with them, for a million dollars... The details vary but the punchline is usually that you just don't need this service. Plus a lot of these farm out the work on your site to untalented workers elsewhere. If you find that you actually want or need a redesign or are curious about what could be done and how much it would cost, I recommend contacting a reputable professional designer or developer. You could post a job listing on Smashing Magazine's site or just contact me!

Conclusions

Being a new business owner can be tough and confusing and lots of people will try to take advantage of that. If a communication seems sketchy or like you've been ripped off before you even started, just ignore them and keep doing what you're good at. Stick with people you can trust. Like if you need good website hosting, go with WP Engine. They're who I host with and I'm very happy to say that they are by far the best webhost I've ever been with. Especially for their customer support. You can call and talk to real people there. They're active in the community and have super fast hosting. Like them, make sure to go with a highly-recommended service no matter what you're shopping for. Google is your friend. Find out what other people are saying about somebody before you do business with them and everything should work out just fine!