Jun 9, 2008

Does your company name ends with the letter 'A'?

If you own a company whose name ends with the letter 'A', you may become a victim of con job. You should be on the alert for similar tricks.

The local newspaper highlighted 2 cases of business-owners who were duped by a man who seeks employment with companies with names ending with the letter 'A'. At the same time he will register a company with similar name, but with an additional letter 'I' at the end.

He will add the additional letter 'I' to the payee name on the cheque, and he then presents the cheque for clearance into the bank account of his newly registered company.

Thus, 'Kujiwa Corporation', will be altered to read 'Kujiwai corporation', and "Aluta Metal' is modified as 'Alutai Metal'.

How can you, as a business owner, prevent the occurrences of such con cases in your business?

Cheque-writing "Do's' and 'Dont's"
I would like to reproduce the words of caution that's printed on the front of the cheque book; some 'Do's' and 'Dont's' for your protection against forgery, fraud or other un-authorised alterations on cheques :

1. Write the payee name, amount in words, and figures left-justified, without leaving any unused spaces. Don't leave wide spaces for other words or figures to be added.

2. Rule through any un-used space with a pair of parallel lines.

3. Conduct regular reconciliation of cheques paid against bank statement.

4. Don't use laser printer, felt-tip pen, erasable pen or pencil, or other non-impact printing techniques to write cheques.

5. Don't give cheques to strangers, even if they represent themselves as Customer's agent. When in doubt, confirm with the other party.

6. Don't exchange cheques for cash with unknown persons.

7. Don't make alterations on cheques.

8. Don't use window envelope to send cheques by mail as this could reveal the contents when being held against the light. Use opaque or good quality envelopes


Customer management

1. Send regular statements to the customer. All overdue accounts should be closely monitored.

2. Have stricter credit control policies.

3. Make a record (in a 'cheques received' book) of all cheques received through the mail, and ensure that they are banked in immediately. Nowadays, most banks have automated teller machines (ATM) which allows you to bank in cheques during off-peak hours. Select the ATM which has scanning facilities which allows the cheques to be scanned.

4. If you entrust a sales person to collect customer cheques, you may want to cross-check the records of the sales visit with the payment collection records. Follow up with a courtesy call to the customer in cases where you suspect foul play.


Read Con man with 'A' certain penchant. The con-man absconded with a cool Rm 292,000 within 2 months.