Attention! Fraud Schemes Against Companies

It is important to know that owning the European Business Number is not mandatory for companies and there is no real benefit in replying to the company’s letter. When responding to the letter, you agree, according to the conditions set out in the letter, to pay 771 euros a year for renewing the number, which the company behind the fraudulent scheme will try to collect. Thus, in order to avoid any problems, we recommend disregarding the letter.

If you reply to the letter, your company will be receiving invoices for the sum mentioned above. If you do not pay the invoice you will be receiving reminders and collection notices that already include higher sums and fines for delay. Paying the invoices or sending an application for terminating the contract have not yielded any results in practice – the claims keep on coming and the company has nothing else to do than to hope, by ignoring the invoices and claims, that at one point the flow of letters will cease.

In a situation where you have entered a contractual relation in the framework of a fraudulent scheme, you could first send a letter to the organisers of the fraud with which you terminate the contract by explaining that it is a fraud. Most probably, you will continue to receive the letters even after the termination and most probably you will be threatened with collection companies or court, but you should ignore such threats.

How to avoid the trap of fraudulent letters:

1. Read all questionnaires and letters carefully, even the small print which may include the biggest traps.
2. If in doubt, research the sender’s background in the Internet and fund out if there have been any claims related to the sender. Very often, even a quick search will give you information on if anyone has been fooled by such scheme before. If it appears that it really is a fraud, disregard the letter and do not reply.
3. Do not sign any documents the content of which you do not fully understand. Any document that has been confirmed with a signature may prove to be a contract that brings along obligations.
4. Do not publish your company’s data if it is not clear who is asking for them and why. Generally, company data is not requested through questionnaires sent by post. Therefore, be careful when making decisions regarding such letters.
5. If necessary, train and inform your employees whose duties include invoice payment and secretarial work.

This format of fraudulent letters is not the only one that is used. At the beginning of the year we warned companies against letters that request payment of invoices by e-mail. Read more on that here.

If you have any problems related to the letter mentioned above or you have any questions regarding fraudulent schemes, you can contact us by writing to juristid[at]koda.ee.