Announced Action(s) for October 5, 1999

The Federal Trade Commission today announced the following actions:

Release of New Consumer and Business Education Alert: To alert small business owners to two Y2K scams - phony billing for Y2K services that were never ordered, and unauthorized switching of phone carriers - the FTC has issued "Y2K? Y2 Care: Avoiding Year 2000 Scams Targeting Small Businesses." The alert is the most recent in a series of publications designed to help consumers and businesses protect themselves from Y2K-related fraud.

The alert provides specific tips that small businesses can use to protect themselves from fraud, including:

• Don't pay for something you didn't order. Check your documentation before paying your bills. Verify that the product or service on the invoice matches the original purchase order. Don't be fooled by nondescript computer service company names with a Silicon Valley address. The "company" could turn out to be a post office box at a store front mail service business where the scam artist collects his payments for bogus services.

• Designate employees as buyers and ask that they document all purchases. For each order, the designated employee should issue a purchase order -- electronic or written -- to the supplier with an authorized signature and a purchase order number. The order form should instruct the supplier to note the purchase order number on the invoice and bill of lading. The buyer should send a copy of every purchase order to your accounts payable department.

• Be wary of calls from people claiming to represent your phone company. Ask for the caller's name and phone number. Call your phone company to verify the caller's relationship and the purpose of the call.

• Ask your phone company for a "carrier freeze" or "carrier restriction." That will prevent any changes to your choice of local, regional or long distance carriers without your express authorization.

• Train your staff. Train everyone in how to respond to telemarketers. Advise employees who are not authorized to order supplies and services, or switch phone and fax line providers, to say, "I'm not authorized to place orders. If you want to sell us something, you must speak to ___________ and get a purchase order."

In addition, the alert provides a list of contacts where small business owners can get more information on Y2K fraud, along with several public and private web sites that contain important fraud-prevention information. Finally, it describes how consumers and small business owners can file a complaint with the FTC and where to get related Y2K and other consumer education information.

Copies of the business alert "Y2K? Y2 Care: Avoiding Year 2000 Scams Targeting Small Businesses" are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Ave., N.W., Washington, D.C. 20580; 877-FTC Help (877-382-4357); TDD for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

(FYI 30.MJK)