Ad Scam Targets Local Businesses

When Northern Rivers Community Legal Centre manager Angela Pollard saw a journal named Drug & Alcohol Review in her in-tray, she thought nothing of it.

But then Ms Pollard saw a document with the word “invoice” on it and a bill for $490, purporting to be for advertising she had authorised.

She quickly picked up the phone and called the company named on the invoice, where she was given pretty short shrift.

Concerned that it might be a scam, Ms Pollard did some internet searches and an ABN check. She also called other local companies whose ads appeared in the publication.

After several conversations with people from glancy media, the company that sent Ms Pollard the magazine and invoice, she was told that it was a “mock up” publication, (there is a stamp ‘PROOF OF COPY’ on the second page).

Ms Pollard faxed off an unambiguous refusal, but then her concern for social justice kicked in as she was concerned other local businesses could get caught up paying for advertising they hadn’t initiated.

“I’ve lodged a complaint with the ACCC, but there are probably people out there who just paid the invoice and are embarrassed because no-one wants to admit they’ve been stung,” Ms Pollard said.

There are several local businesses featured in the “mock-up”, with one business owner saying he had been approached to pay for an ad he had not authorised but when he argued the point they eventually backed down.

There is an actual magazine called The Drug and Alcohol Review, a professional journal published by the Australasian Professional Society on Alcohol and other Drugs (APSAD). When contacted by The Echo, APSAD said they had made several complaints to government and legal authorities about their magazine being misrepresented.

Deputy chair for small business issues at the ACCC, Michael Schaper, said these sorts of operations often targeted geographic areas.

“They’re unsolicited calls, generally purporting to be either from a magazine that is very similar to an existing publication, or some even purport to be a particular publication,” Mr Schaper said. “Typically they target small business or small not-for-profits or community organisations.

“There’s classic potential here for small business to be hit. Many of them don’t have a lot of resources, the record keeping is a low order priority or done by volunteers, or book-keeping is done on a semi-regular basis, so there isn’t necessarily one person who can say no.

“In a lot of small businesses, the owner does the book keeping and if it’s for a really small amount, they might not remember $50 or $100 and say ‘what the heck’ pay it and be done.”

Mr Schaper said the ACCC has a scamwatch website and that they endeavour to investigate every complaint. He said it was important to report it, if you think you’ve been the victim of a scam or you think a company is unethical or unscrupulous.

“Scams come in all sorts of variations, with pressure that you’ve got to pay, receiving letters of demand or phone calls,” he said. “Let others know about it, scams often target a geographical area, prey on a town or an industry, so the calls can be coming out of a local phone directory, industry journal or chamber of commerce.

“One of the things about scams is that they are incredibly mobile as well, setting up electronically or overseas, out of our jurisdiction or they can shut down at will and reopen in another form – but I don’t think that means you should not try to stop them.

“The ingenuity of scammers is quite amazing, they can go to inordinate lengths, and in some respects people aren’t aware of what’s going on.”

If you think you have been approached by a questionable business person report it on the scamwatch website www.scamwatch.gov.au.
Source: NR Echo, Rudi Maxwell

11 May 10