Freight bill factoring helps trucking companies get cash quickly to run their businesses smoothly. This cash allows the companies to keep up with day-to-day expenses, maintenance charges, fuel costs, and more. But occasionally, like all businesses, trucking businesses too can become victims of fraudulent practices. They may fall for certain freight bill factoring frauds that can lead to huge losses. So, here are a few of such scams to avoid:

1. Enticing offers
There is no such thing as a free lunch; if it’s too good to be true, it rarely is. Like everything else, this holds true for businesses. Freight factoring scammers will approach one with a great offer much above market prices. One needs to be careful when met with an offer they cannot refuse, but refuse they must. These scammers promise a fantastic payout but have no intention of paying the money. So, an unbelievably high offer must be thoroughly investigated.

2. Impersonation and identity theft
Fraudsters are increasingly becoming tech-savvy, and there have been cases where they have impersonated legitimate companies down to the near exact logos and email addresses. They have even gone so far as to steal legitimate Motor Carrier (MC) numbers to get loads booked. This is also called MC hijacking, and scammers use these numbers to impersonate the carrier, book a load, and then steal the cargo.

3. Fuel fraud
This is when a scammer poses as a carrier, approaches a trucking company, and offers to transport a load. Once they receive the go-ahead, they will request an advance to cover the cost of fuel. Once the fuel payment has cleared, the scammer disappears with the money without transporting the load.

4. Timing fraud
Here, the trucking company might manipulate the timing of invoices and payments to cheat the factoring company. They might not relay payment information from their clients to the factoring company to make it seem like some outstanding invoices are eligible for factoring.

5. Double factoring fraud
Here, the trucking company hands off the same invoice to more than one factoring company, and after the payment is received, only one of those factoring companies gets paid, while the other incurs a loss.

6. Collusive fraud
This occurs when a client and a debtor collude to scam the factoring company. The client will submit a fake invoice for fictitious sales and services, and the debtor will verify and confirm the authenticity when the factoring company reaches out for verification.