ComCom warns of false billing scam by serial German fraudster

Tuesday 4th August 2015

The Commerce Commission is warning small business owners to avoid a postal invoicing scam by a German company operating the Corporate Portal New Zealand website, which has fooled a number of kiwi companies.

The German company has previously targeted British and Australian small business owners and featured on scam alerts in New Zealand from the Ministry of Business Innovation and Employment and the Department of Internal Affairs.

Business owners were approached to update their business details with Corporate Portal and then misled into taking an ongoing subscription to a basic online directory for $1,411 annually for at least three years.

Commerce Commission general manager of competition Kate Morrison said it had received 18 complaints about this company, and others about similar scams.

“In this case, business owners have been sent formal looking letters with the letterhead ‘New Zealand – Companies.’ This has led some of them to believe they are obligated to provide their details for the New Zealand Companies Office,” she said.

The letter tells businesses to complete their basic details by a certain date or risk removal from its portal website.

While the letter gives business owners the impression the service is free and that their business is already listed and just needs updating, filling out the form and posting it back signs them up to the annual subscription, Morrison said.

Under the terms and conditions, business owners will find it difficult to cancel and Corporate Portal reserves the right to increase the annual fee without consultation.

Corporate Portal is claimed to be a business of ‘TVV Tele Verzeichnis Verlag GmbH’ and its letter states it is based in Hamburg.

Morrison said business owners should do due diligence on any unsolicited correspondence, including checking with the relevant government department.

It has recently warned of another online based organisation, New Zealand Small Business Assistance Centre, which used similar tactics to get money from small business owners.

The commission has a list of measures small businesses should take to protect themselves from scams, including limiting the number of staff with authority to make purchases or write orders, keeping written records of all orders and purchases, and reconciling invoices against orders. If an invoice refers to an advertisement or directory entry genuinely made by the company, staff should ensure all the details add up as billing scams often use real advertising as a basis for fake invoices.

BusinessDesk.co.nz

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