The Loop Technologies in Boise, Idaho, was recently hit by a creative credit card scammer and president Eric Crawford wants the entire industry to know about it so it doesn’t happen to them.
Several months ago, a prospective customer called in asking if The Loop Technologies sold any of the new massive Sony OLED TVs. The customer did not want custom installation or delivery, but planned to pick it up himself.
“We told him ‘Yes, we could order it and have it within a few weeks,’” recalls Crawford. A few hours after that initial phone call, the customer called back and said he wanted to purchase the TV and innocently asked if The Loop Technologies would accept a credit card over the phone. The company took the credit card information over the phone and ran it through Quickbooks and the charge went through as approved.
Weeks later when the TV was delivered, the company emailed and called the customer informing him that the TV had arrived. The client said he would be by to pick it up. A few hours later, the customer called back saying he was having car problems but one of his friends, who he identified, would be picking up the big TV.
As planned, someone showed up to get the TV, but it would not fit in his car. He came back later with a larger vehicle and the staff at The Loop Technologies helped put it in his car. The staff verified his name and even had photos of his vehicle from their surveillance cameras.
“Two weeks later we got a phone call from someone asking why he had a $7,700 charge on his credit card from us. That caller was the real owner of the credit card,” recalls Crawford.
Obviously, the credit card company voided the charge due to the fraud. That is when Crawford discovered that his company was responsible for the back charge. In this case, it was the full $7,700.
“I erroneously thought that the 3% fee we pay to process the credit card protected us, but it doesn’t,” says Crawford. “We talked to the police and the guy who picked up the TV was just some mule who was hired by the scammer. He didn’t know it was a scam.”
So in retrospect, Crawford offers advice to other integrators to avoid a credit card scam like this, including:
- Possibly institute a policy whereby you will not sell equipment unless you are installing it.
- Never take a credit card payment over the phone.
- Institute a policy that requires the person picking up the gear to have a photo ID that is the same name as the credit card.
- Find a credit card processing company that has protections built in for you.
Speaking of the scammer, Crawford notes, “I admit he was pretty ingenious but it still pisses me off.”
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