Small firms must slam the door on mis-selling

Bill Murphy, managing director of BT Business, discusses the ways small business can protect themselves from dishonest marketers.

Mis-selling refers to the misleading or deceitful sales and marketing practices deployed by salespeople.

Despite efforts to raise awareness of mis-selling practices, increasing numbers of small- and medium-sized businesses (SMEs) are still falling victim to these underhanded and often illegal tactics, finding themselves bound into unwanted, mis-sold contracts.

New research BT has conducted among SMEs in the UK shows that telecoms remains the number one most commonly mis-sold business service, with almost 60% of SMEs reporting experiences of dubious sales approaches from telecoms providers. That’s an increase of 13% in attempted mis-selling over the last seven months.

What we’re hearing from businesses is that mis-selling is escalating as a serious issue, with 38% receiving telecoms mis-selling approaches at least every other day. It is also costing many SMEs dearly: those trapped with a mis-sold contract reported significant costs in terms of the time and hassle involved, while others incurred steep legal fees.

Many SMEs said they are now more confident of their awareness of mis-selling, with 41% reporting that it is becoming easier to identify such calls. However, only 22% of small companies actually provide a formal briefing, training or written guidelines for staff on identifying mis-selling, while 44% have no processes to identify rogue or mis-sold products or services.

Our message to businesses is that they must take steps to ensure that staff are aware of the mis-selling issue and are able to recognise the warning signs. What may seem like an appealing deal at the outset may turn out very differently once you have read the small print, or when you later find out that the real deal is very different from what the sales representative sold it to you as.

Some common mis-selling tactics include:

· "Slamming" – this is the most extreme form of mis-selling when a telephone company transfers your calls and/or your phone lines without your consent. There are cases when unscrupulous sales people have gone as far as forging customers' signatures.

· "Just sign here for more information" – when a sales person gets you to sign a contract under false pretences, telling you they need your signature as a formality, or to send you more information, for example.

· Misuse of cancellation rights – when you call another telephone company just to get some information, but they insist that the only way you can do that is to agree to transfer you to a different type of service, which you can then cancel at a later date.

· Signing forms for other services - if you buy company mobile phones, you may be asked to sign a number of forms. One of these may also transfer your fixed lines to a new company without this being made clear.

There are now industry-agreed processes governing Carrier Pre-Selection (CPS) and Wholesale Line Rental (WLR) transfers and most telecoms companies treat their customers and potential customers fairly. However, mis-selling has still proved to be a significant problem as some unscrupulous salespeople use techniques to get a sale that most feel are unacceptable.

The majority of small businesses – or 78% – believe that the telecoms industry should do more to protect them, and we at BT agree it is the responsibility of everyone in the industry to work together to offer guidance and implement measures that will help safeguard businesses from mis-selling practices.

Businesses should look out for the following to identify sales callers who may be attempting to mis-sell them something:

· The caller not clearly stating who they are or who they represent.

· Over-familiarity, including the repeated use of your first name.

· The caller implying they are part of a well-respected company when they are not.

· The caller getting put through to you by implying you already know them.

· The caller wanting to know who your existing supplier is very early in the conversation.

· The caller making an offer that you consider too good to be true.

· The caller being unwilling to send you full details of the offer in writing.

· The caller or company not taking no for an answer and repeatedly calling again.