I'm getting ready to list my business for sale and the more I read about online fraud the more nervous I get. Fake buyers, escrow tricks, phishing emails that look like they're from brokers... What are people actually doing to protect themselves during a sale? I don't want to get burned before I even see a real offer.
Fraud
How do you keep your sale safe from online fraud?
First thing: never trust an email just because it has a broker's logo on it. Call the brokerage using a number you find independently, not the one in the email. I got a fake wire instruction last year that was almost perfect.
This is going to sound basic but use a dedicated email address for the sale. One that isn't tied to your public business contact info. Cuts down on the phishing a lot.
The escrow thing is where I'd focus. Only use an escrow service you pick yourself or your attorney picks, not one the buyer suggests. A buyer pushing hard for their own escrow company is a red flag, full stop.
Agreed on escrow. Also verify the escrow company is actually licensed in your state before you send anything. Took me ten minutes on a state website and it saved me from a sketchy one.
Thanks, this is helpful. I hadn't thought about picking the escrow myself. What about buyers who want to do everything over email and never get on a call?
No call, no deal. I don't care how busy they claim to be. A real buyer with real money will get on a video call at some point. The ones who won't are usually wasting your time or worse.
Also get an attorney involved early. Mine reviewed every document before I signed anything and flagged a clause that would have let the buyer walk with my customer list. Worth every penny
One more thing nobody mentions: lock down your business accounts and change passwords before you start sharing financials. You'll be sending tax returns and bank statements to strangers. Make sure your own house is in order first.