How Scammers Use Small Business Names to Send Fake PayPal Invoices

Fake PayPal invoices don't just target the people who receive them. Scammers can also use the name of a legitimate small business to make fraudulent invoices look more convincing—leaving the business to deal with confused customers, complaints and potential reputational damage.

Here's how the scam works, how to tell if your accounts have been compromised, and what to do if scammers are using your business name.

Key takeaways:

Fake PayPal invoices may use the name of a real small business to make the request appear legitimate.
Scammers often include a phone number and urge recipients to call to cancel or dispute a supposed charge.
Your business may be impersonated without any account breach, but unexpected invoice activity can also indicate that a PayPal or email account has been compromised.
If scammers are using your company’s name, secure your accounts, report the fraudulent invoices and warn customers through your official channels.
Unique passwords, two-factor authentication and monitoring inactive business accounts can reduce the risk of account takeover and misuse.

How a Small Business Became the Face of a Fake PayPal Invoice Scam

In Connecticut, a vintage furniture shop called Palomino Bazaar discovered its name on more than 200 fake PayPal invoices sent to people across the U.S. The owner, Kate Ferguson, wasn’t chasing payments—her business was inactive. But her inbox and phone lit up anyway: confused strangers, even a whole school district in Pennsylvania, asking about “their” bill.

The invoices looked real and demanded about a thousand dollars. Instead of a normal PayPal button, the message told recipients to call a phone number to “fix the problem.” That number belonged to the scammers. Kate reported the scam to the Better Business Bureau and closed the PayPal account in question. She suspects the email tied to that old account, using the same password as PayPal, was compromised. The fallout didn’t stop there. People began confusing the scam with her separate interior design company, Palomino Interiors, putting that brand’s reputation at risk for something she didn’t do. (source: ctinsider.com)

How Do Fake PayPal Invoice Scams Work?

Fake PayPal invoice scams can affect you in two ways: you may receive a fraudulent invoice, or scammers may use your business name or account to make their invoices look legitimate.

If You Receive a Fake PayPal Invoice

You receive what looks like a real PayPal invoice or money request for something you didn't buy. The message may create urgency with instructions such as "Call now to cancel," "Your account is compromised," or "Dispute within 24 hours."

The phone number is often the real trap. If you call, someone posing as a PayPal representative may try to convince you to share payment or account details, install remote-access software, or make a payment supposedly needed to cancel the transaction.

The invoice itself may even have been sent through PayPal's legitimate invoicing system. What makes it a scam is the fraudulent payment request and the instructions designed to move you away from PayPal and into direct contact with the scammer.

Instead of calling a number or following instructions in an unexpected invoice, open PayPal directly and check your account.

If Scammers Use Your Business Name to Send Fake PayPal Invoices

If scammers send fake invoices using your business name, it doesn't automatically mean they have access to your PayPal account. There are two main possibilities:

1. They are impersonating your business. Scammers can use your company name or logo in an invoice or spoofed email without gaining access to any of your accounts. They are simply borrowing your brand's credibility to make the scam more convincing.

2. One of your accounts has been compromised. If attackers gain access to an old or poorly protected PayPal or email account, they may be able to send invoices or money requests using your real business profile. Reused or stolen passwords can make this type of account takeover easier.

In either case, your business may be the one dealing with the fallout. You could suddenly receive calls, emails or complaints from people asking why you charged them for something they never bought. If an account has been compromised, you may also notice unfamiliar PayPal activity, unexpected login alerts, password-reset messages or suspicious changes to your email account.

Even when nobody pays the fake invoice, scammers can still damage the trust you've built around your business name.

What to Do If Scammers Are Using Your Business Name

If customers or strangers start contacting you about PayPal invoices you didn't send, don't assume it's only impersonation. First, check whether scammers have actually gained access to one of your accounts.

1. Check your PayPal and email accounts. Sign in directly to PayPal and review recent activity, invoices, money requests, login history and account settings. Check the email account connected to PayPal for unfamiliar logins, forwarding rules, password-reset messages or other suspicious activity.

2. Secure any affected accounts. If you find signs of unauthorized access, change your passwords immediately and enable two-factor authentication. If you've reused the same password elsewhere, change it on those accounts too. Remove unfamiliar devices, sessions or users and secure any old business accounts you no longer use.

3. Report the fraudulent invoices. Contact PayPal through its official website and provide invoice IDs, screenshots and any other information you have about the scam. Keep copies of suspicious emails, phone numbers, messages and reports in case you need them later.

4. Warn customers through your official channels. If the scam is widespread, post a short notice on your website and social media accounts explaining that fraudulent PayPal invoices are using your business name. Tell people how you normally request payments and remind them not to call phone numbers or follow instructions included in suspicious invoices.

5. Watch for further impersonation. Search for your business name and check whether scammers are also using your brand elsewhere. Continue monitoring your PayPal, business email and other important accounts for unusual activity or attempts to reset passwords.

How to Protect Your Small Business From PayPal Invoice Scams

A few simple habits can make it harder for PayPal invoice scams to fool you or your employees and reduce the risk of scammers taking over an account and using your business name.

Verify unexpected invoices directly in PayPal. Don't click links or call phone numbers included in an invoice. Open PayPal separately and check the request from your account.
Treat urgent instructions to call as a red flag. Be suspicious of invoices claiming you need to call immediately to cancel a payment, dispute a charge or prevent money from leaving your account.
Protect PayPal and the email account connected to it. Use strong, unique passwords and enable two-factor authentication. Never reuse the same password for PayPal and your business email.
Secure accounts you no longer actively use. Review old PayPal accounts, remove former employees who still have access and close accounts your business no longer needs.
Set clear rules for approving payments. Make sure employees know how invoices should be verified and who is authorized to approve payments, particularly if several people monitor shared addresses such as finance@ or info@.
Teach employees to question convincing messages. A professional-looking PayPal invoice isn't proof that a payment request is legitimate. Employees should know to stop and verify unexpected requests before paying, clicking or calling.

Security tools can provide another layer of protection when a scam reaches someone's inbox or browser. Bitdefender Ultimate Small Business Security includes Phishing & Email Protection to help block malicious links and websites, while Scam Copilot can help employees check suspicious messages before acting on them.

Try Bitdefender Ultimate Small Business Security free for 30 days, no credit card required, and roll it out across your team and see how it fits into your business.

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FAQs

Can someone send a PayPal invoice using my business name?

Yes. Scammers may impersonate a legitimate business by using its name or logo in fraudulent invoices or emails. In other cases, they may compromise a real PayPal or email account and use it to send invoices or money requests that appear to come from the business.

Does a fake PayPal invoice mean my account has been hacked?

Not necessarily. Scammers can impersonate your business without accessing your PayPal account. However, if unauthorized invoices or money requests appear in your account activity, treat this as a possible account compromise and secure both your PayPal account and the email account connected to it.

How can I tell if a PayPal invoice is fake?

Be suspicious of unexpected invoices, especially those that create urgency or tell you to call a phone number to cancel or dispute a charge. Don't use links or contact information in the message. Open PayPal directly and check the invoice or money request from your account.

What should I do if I receive a PayPal invoice I don't recognize?

Don't pay it or call phone numbers included in the invoice. Sign in to PayPal directly to review the request and report or decline it using the options available in your account. If you interacted with the sender or shared financial information, secure your accounts and contact your bank or card issuer if necessary.

What should I do if scammers are sending PayPal invoices in my business's name?

Check your PayPal and connected email accounts for unauthorized access, change compromised or reused passwords, and enable two-factor authentication. Report fraudulent invoices to PayPal and preserve evidence such as invoice IDs and screenshots. If customers are being targeted, warn them through your official website, email or social media channels.