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Con Artists Swindle Promo Distributor

June 15, 2021 12:05 PM | Dara Cormany (Administrator)

The impostors posed as a legitimate end-buyer – a scheme crooks may increasingly be advancing against promo products firms.

By Christopher Ruvo 

A promotional products distributor is on the hook for 10,000 branded flash drivers after scammers swindled the company in a con that’s being increasingly attempted against industry firms, according to the victim.  

The same distributor, which is new to the industry and based in the Northeast, detected two other similar scam attempts, at least one of which was from the same individual or criminal group that executed the first.

“Basically, the scheme is the same: order branded merchandise with a fake purchase order and never pay for the product,” said an executive with the distributorship, which ASI Media is keeping anonymous.

Executives said the conning serves as a cautionary tale for distributors and suppliers to be vigilant as crooks appear to be ramping up efforts to rip off promo firms by taking advantage of companies’ eagerness to rebuild business in the wake of COVID-19’s economic ravaging of the industry, which saw collective annual sales decline by about 20% in 2020.

“These schemes are specifically targeting the promo industry, and we need to make as many people aware of this as possible,” the executive at the victimized distributorship said. “The financial and emotional loss will be devastating for any small business who is trying to recover from the long pandemic.”

The scam that snared the distributor involved a criminal emailing the company and pretending to be a procurement manager from Ohio University, Michael Pidcock, who wanted to buy 5,000 branded flash drives. Pidcock is an actual individual who works in procurement at the university – something the distributor looked into by checking on LinkedIn and on the educational institution’s website.

Unfortunately, it wasn’t the real Pidcock, but an imposter.

scam phishing email

The emailed quote request from the scammer had a few red flags, including the email address, but the distributor felt it ultimately seemed legit.

There were a few red flags. The email address from which the imposter had sent the message was “ohio-edu.org” – instead of what should have been just an “ohio.edu.” It was difficult for the distributor to get anyone on the phone to verify things, though they tried, but even that wasn’t a major surprise given COVID realities. “Most schools are closed due to COVID and it was understandable,” the executive said.

The executive continued: “It seemed legit. We continued to communicate via email, discussing logo artwork format and more. He changed the Pantone color. He always emailed back quickly. The purchase order was a bit amateurish, but since we communicated a lot, we didn’t give it too much thought.”

The order came with a 30-day net payment policy and a request that the flash drives be sent to an address in Ohio that was a FedEx store rather than the school campus. That raised an eyebrow. “I was a little suspicious, but thought FedEx might provide gift-dispensing services and did not pursue it further,” the executive said.

So, the order shipped. About a month later, in mid May 2021, the scammer again contacted the distributor with a request for another 5,000 flash drives. While the distributor had not been paid for the first order, the firm decided to go into production on the second order, as it followed up trying to get payment for the first.

Those collection attempts finally led the distributor to make phone contact with an actual accounting manager at Ohio University, who conveyed that the orders were frauds. According to the distributor, the real purchasing manager, Pidcock, also confirmed he did not submit the orders. The real Ohio University and its representatives are not accused of having any part in the scheme.

The swindle was now plain to see, but the realization had come to late.

“We had shipped the first 5,000 flash drives and have the second 5,000 sitting in our office with the university’s logo on them and we can’t resell them,” the executive said. “We have huge bills to pay.”

The third scam attempt involved criminals pretending to be buyers from Harvard University. They submitted what the executive described as an “obviously fake” purchase order and resale certificate for 2,500 vacuum water bottles. The distributor quickly spotted this scam for the con it was.

“On the PO, the delivery address was in New Jersey, which was very suspicious,” he said. “The email domain did not end with ‘.edu.’ Still, the fact that whoever is behind this is taking their time to forge these POs is chilling.”

The distributor said that he hopes by sharing his story, others will not fall prey.

“Our business is OK, and we will survive this with support of family and friends,” the executive said. “I have always considered myself computer savvy, but it looks like we all have our weak moments. Lesson learned the hard way.”

Used with permission from ASI

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