The owners of Pengrove Farm in Hudson are calling for policy changes to protect small businesses from “buyer scams” after losing $27,000 worth of goods to a fraudulent catering company. In April, the farm, owned by couple Alana Cosgrove and Matt Penney, received a substantial order from a customer who said they had a catering company and were looking for high-quality, locally sourced meat. “When the credit card went through, it didn’t flag us as being suspicious, even though it was a large order,” said Cosgrove. When the alleged caterer made a second order, only part of the payment went through, and the rest of the order was not fulfilled. The farm fulfilled two orders totalling $20,000 ($27,000 on the retail market) which were processed online through their point-of-sale-terminal, Square. Weeks later, they found out from Square that the charges were fraudulent. “So they were advising us that all these charges that they had approved were now fraudulent charges that the original cardholder was disputing,” said Penney. The couple found out they were on the hook for the entire amount, and say Square gave them 48 hours to pay back the money. “They started coming after us for immediate seizures of the entire funds of the order, which was large amounts of money,” said Penney. Cosgrove said Square has seized a substantial amount of money they are holding until they can agree to repayment terms. The couple, who bought the farm two years ago as a place to raise their children and start a business, said it’s more than they can afford. Their insurance won’t cover the cost, so they set up a GoFundMe. They said they have been overwhelmed by the local support and have heard from other businesses who’ve also been victims of similar scams. They said more should be done to protect small businesses. “These processing companies don’t protect small businesses,” said Cosgrove. A spokesperson for Square said they cannot comment on this specific case. “Fraudsters exploiting small businesses is a serious problem and causes real harm. When a seller has been the victim of buyer fraud, we work with them directly, case by case,” the spokesperson added. While they are sorting things out with Square, the couple say they are no longer accepting credit card payments. They said while there was an initial sense of shame when they were scammed, they believe sharing their story will help others. “Through all the community support, the outreach, the attention it’s getting, it’s kind of giving us the will to kind of push forward and make this a bigger issue,” said Penney.
