Yellow Page directory con targets WA businesses again
WA businesses have been receiving bogus order forms and invoices for unauthorised directory listings and advertising from scammers mimicking the Yellow Pages name and logo.
Consumer Protection and the Small Business Development Corporation (SBDC) have urged businesses to be on alert for this scam and ensure that unnecessary payments are not being made.
Unsolicited and misleading order forms are being faxed and emailed to numerous WA businesses and feature the name ‘Yellow Page Australia’ with the familiar “walking fingers” logo. Initially it appears to be a confirmation of contact details, but is cleverly disguised as an agreement to sign up for an online business directory.
The company behind the latest variation of this scam, Open Business Directory Ltd, claims to be based in Hong Kong but operates a website www.yellow-page-australia.at on the Austrian domain, which is registered to the business in the Russian Federation. An abuse report has been forwarded to domain authorities in Austria.
The latest batch of bogus invoices asks for payment by credit card, bank transfer or by cheque posted to a Hong Kong address. Australia Post has intercepted payments being sent by WA businesses and cheques have been returned where possible. If payments are not made, the businesses receive numerous reminders threatening legal action. The invoices include two-year contracts for listings at a cost of $AU99 per month, paid yearly.
The Yellow Page scam first surfaced in mid-2010 when public warnings were issued. The entities behind it, Yellow Publishing Ltd and Yellow Page Marketing B.V. based in The Netherlands, were prosecuted by the Australian Competition and Consumer Commission (ACCC). In April 2011, the Federal Court in Melbourne imposed penalties of $2.7 million, issued an order prohibiting the use of the Yellow Pages logo and declared the contracts with Australian businesses void. Authorities in the United States and Canada have also successfully prosecuted other scammers involved in an identical scheme. The ACCC is also investigating this latest scam.
Consumer Protection advises businesses to check carefully that contracts and invoices for their Yellow Pages listings and advertising are genuine before any payments are made.
This scam attempts to confuse business operators into thinking they are paying for a genuine listing in the well-established Yellow Pages directory. It is no coincidence that this scam has registered a website in Austria to make it look like it is based in Australia to deceive unsuspecting business customers, so caution needs to be exercised so that these scammers are not rewarded for their deceptive practices.
It is important that businesses affected by this scam refuse any demand for payment and stop making further payments to this company. Previous Federal Court action for similar scams has shown that these companies do not have legitimate claims for payment, even if a contract was signed.
Staff authorised to sign contracts and pay invoices should be made aware of our warning so that more businesses don’t fall victim to this scam.
Advice to businesses from Consumer Protection and the SBDC:
- Read all documents carefully before signing any contracts for directory listings or advertising
- Restrict the number of employees who are authorised to sign contracts and approve payments for directory listings or advertising
- Avoid giving out information about your business to third parties before clarifying the purpose of their enquiry
- Deal with people you know and trust wherever possible
- If you receive a ‘Yellow Pages’ fax or email, confirm if it is authentic by calling Sensis on 13 23 78
- If you receive a threatening letter demanding payment for unauthorised listings or advertising, ignore it and report it to WA ScamNet
- Spread the word – make sure your staff are aware of how these scams work and protect your business
Small Business Commissioner David Eaton said busy small business operators can be easy targets for scammers if they don’t have effective systems or processes in place.
“It’s important for all businesses to take the time to ensure their staff have the knowledge they need to follow established purchasing and payment processes, and to recognise when something isn’t right,” Mr Eaton said.
“The SBDC has a workshop tailored specifically to help small business owners understand why systems are important, and how to recognise priority areas in their business.”
Consumers can contact Consumer Protection by email: firstname.lastname@example.org or by calling 1300 30 40 54. Businesses can contact the Small Business Development Corporation on 131249 or by email: email@example.com.