A friend of mine has a theory about high-end corporate
credit cards. You know, credit cards with high balance limits. His theory is
that vendors will run through charges on corporate cards for products and
services that the cardholder didn’t intend to buy.
Maybe the cardholder plays golf at a club. Somehow, he
or she ends up getting a charge on his card for a subscription to a golf
magazine. Let’s say an office assistant handles corporate card expenses. The
assistant sees the golf magazine charge and pays it. After all, the cardholder
is a golfer- they must have intended to buy the magazine…..
As the theory goes, the vast majority of corporate
cardholders won’t pay any attention to small dollar charges- they’ll simply pay
them. A vendor might be making a lot of revenue, one small charge at a time. If
you like conspiracy theories, that’s a pretty good one!
Pilot
Flying J Allegations
Maybe there’s more to my friend’s theory than I first
thought. You’ve probably seen-or even visited- Pilot Flying J truck centers. They
serve trucking companies as a “one stop shop” for a trucker. In addition to
fuel and food, they offer showers, electrical hook-ups for trucks, as well as
truck maintenance.
Recent FBI allegations accuse a company of something
very close to what I just described: the
allegations are that “Pilot employees engaged in a scheme to deceptively
withhold discounts from customers to boost company profits and their own sales
commissions.” (“FBI Raid, Fraud Allegations Rock the Trucking Industry”, Wall
Street Journal, 4/21/13).
“Among the
allegations: a top company sales director allegedly altered spreadsheets to
lower the rebates owed customers on a routine basis; that if a customer caught
an employee in the alleged deception, the employee was to blame it on a
computer glitch.” (bold and italic added).
The affidavit also asserts that “sale employees
discussed the potential for a new internal Pilot two-tiered pricing structure
that would impose higher prices on less sophisticated customers.”
How
closely are you reading that credit or debit card statement?
A manager at one trucking company said “that the
discounting is usually handled through credit-card processing”, rather than
rebates issued by check. In either case, the message is clear to a business
owner: Invest some time to check on those small transactions. Over time, they
total amount might be significant. The article reported that Pilot Flying J has
3,300 trucking customers. Each of those customers may have dozens of trucks on
the road. A lot of small transactions can add up to a significant amount of
money.
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Thanks!
Ken Boyd
St. Louis Test Preparation
(cell) (314) 913-6529
(email) ken@stltest.net
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