FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 1 A. The Purpose of This Policy The purpose of this policy is to inform Hotel management of common methods used to defraud hotels and to establish policies to avoid such fraud. Continue ► Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 2 B. Avoiding Common External Scams and Frauds Following is a description of various external scams and frauds and how to avoid becoming a victim of them. 1. Travel directories Travel directories 2. Copy machine toner and maintenance contracts Copy machine toner and maintenance contracts area codes 972 area codes 4. Unsolicited deliveries Unsolicited deliveries 5. Yellow Pages invoices Yellow Pages invoices 6. Advance payment refunds Advance payment refunds Continue ► Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 3 B. Avoiding Common External Scams and Frauds (cont.) 1. Travel directories: Description: The Hotel receives what is designed to appear to be a request verifying the hotel’s listing in some important-sounding directory, such as Worldwide Hotel Guide, Japanese Travel Directory or Official Government Hotel Guide. The person sorting the Hotel mail sends it to the sales or reservations department where it is signed and returned to the sender. It is actually a contract obligating the Hotel to hundreds of dollars in fees for a directory of doubtful benefit. Prevention: Tell all Hotel team members that only the general manager may sign any document on behalf of the Hotel and enforce this practice. Continue ► Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 4 B. Avoiding Common External Scams and Frauds (cont.) 2. Copy machine toner and maintenance contracts: Description: The Hotel receives an invoice for maintenance or toner for its photocopier. Because the invoice has the photocopier’s serial number, it looks legitimate. Actually, the sender called the Hotel weeks earlier and asked to verify the serial number on our photocopier and was given that number by an unsuspecting employee. Prevention: Tell all Hotel team members to never give out any Company information without a good reason and a supervisor’s approval. Continue ► Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 5 B. Avoiding Common External Scams and Frauds (cont.) 3. Calls to area code 972: Description: Guests, visitors and employees make calls to telephone numbers with 972 area codes. These are pay-for-use telephone numbers, so the Hotel is obligated to pay large sums for those calls. Prevention: Program all Hotel telephones to block calls to pay-for- use area codes. Continue ► Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 6 B. Avoiding Common External Scams and Frauds (cont.) 4. Unsolicited deliveries: Description: The Hotel receives a delivery for something it did not order—often light bulbs, cleaning supplies or chemicals. The delivery is followed by a series of invoices and late notices demanding payment. The sender often uses the name of a former maintenance or housekeeping supervisor saying that the she or he called to order the product. Prevention: Strictly adhere to our Purchase Order policy and regularly communicate that policy to all vendors. When something is received that has not been ordered, send a letter demanding that the merchandise be picked up within 30 days or it will be discarded. Continue ► Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 7 B. Avoiding Common External Scams and Frauds (cont.) 5. Yellow Pages invoices: Description: A “vendor” sends an invoice for one or more listings in a valid Yellow Pages book. Many of these invoices are fraudulent, because the publication has little or no distribution, and we did not agree to advertise in the publication. Prevention: Do not pay any Yellow Pages invoices except those appearing on our telephone bill. Yellow Pages advertising billing appears on our invoices for other telephone services, so you should not pay any invoice that is solely for Yellow Pages listings or advertising. Continue ► Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc. 8 B. Avoiding Common External Scams and Frauds (cont.) 6. Advance payment refunds: Description: A guest—usually a group planner—arranges to send a large deposit or advance payment by check or credit card. He or she explains that the Hotel is to immediately pay back part of the payment to another party. After the Hotel makes its payment or refund, the group planner’s check or credit card is found to be invalid. Prevention: Do not make refunds or payments from funds that have not cleared the bank or credit card company. See MMI Team Site (the MMI Best Practices, Accounting & Controls section and the Articles, Accounting and Controls section) for more information on frauds and scams.MMI Team Site End Financial Controls Guide, 7610 Common External Frauds and Scams

FINANCIAL MANAGEMENT GUIDE © Marin Management, Inc Financial Controls Guide, 7610 Common External Frauds and Scams