Over the past few years we've been hearing more and more stories about one kind of equipment fraud or another, and recently we have been dealing with some sort of fraud every single week!

Equipment fraud surfaces generally in two different ways. The first, and most common way, has to do with the equipment itself. The second, and much worse type of fraud, has to do with the person the equipment is purchased from.

Equipment fraud has evolved because of many reasons. Everyone wants a good deal. They don't appreciate that a good deal may not be a good value. Most equipment is complex, and its condition can be anywhere from completely worn out and useless to equipment which operates in excellent condition. It is definitely not a commodity, even though many people these days would like it to be. With all the equipment on the market because of people going out of business, or consolidating, there appears to be lots of good deals available. Our experience has been that the good deals are cheap for a reason. There are worn out parts, missing parts, parts that are no longer available, machines that are not as productive, and machines that need repair or costly servicing. You get what you pay for. Our technicians keep very busy servicing machines bought online through various web sites. You are gambling when equipment is purchased this way. Sometimes you win, but usually it will cost more than if you bought a machine that has already been serviced and guaranteed by a reputable equipment dealer.

The second kind of equipment fraud is becoming more and more common. This is where the equipment you receive is not what you paid for, equipment being misrepresented, or not getting any equipment after paying for it! These types of situations have become more and more common due to the challenging times of our industry and economy. Some equipment dealers, many equipment brokers, and printers too, are inclined to not be as honest as they should be. Desperate people do desperate things! We've heard many instances where someone had put a substantial deposit on a machine, only to lose it because the broker is just pocketing the money, or maybe he didn't really have the right to sell the machine in the first place and had already spent the money elsewhere. Again it's buyer beware!

So what do you do to properly research and check out the equipment you are considering? Don't just buy it off the computer, unless you really trust the seller. Go see it. Test it. Hire an expert to inspect it for you. We have been videotaping machines that we are selling to demonstrate its operation when a customer is in a different state or country and cannot inspect it personally. You should ask for the same.  

How can you be confident in who you are buying equipment from? Ask if they own the equipment or if they are brokering a third party's equipment. Do they have technicians that can service the equipment if necessary? How long have they been in business? Call Printing Industry Credit Bureau for a due diligence report. Ask the seller for recent references and call them. Do a Universal Commercial Code (U.C.C.) lien search to make sure that the seller has a clear title. If there is a bank lien on the equipment be sure to get a letter from the bank that states they will provide clear title upon receipt of payment.  

While there's never a 100% guarantee on anything in life, taking these steps will protect you from the obvious causes of fraud that, unfortunately, happen every day. Remember: BUYER BEWARE!  

Article written and submitted by Steve Tompkins, President of  Tompkins Printing Equipment Company, @ www.tompkins.com 

Andrew Totz

Totz Ellison & Totz P.C. 

Houston TX 

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