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ACCC Article - Protecting Your Business

19th Aug 2011

ACCC Small Business Information Network (SBIN)

Dear SBIN members,

Beware of unscrupulous operators - protect your business

Small business owners are often busy, with many different tasks on their hands. At times, unscrupulous operators may take advantage of this and attempt to trick a small business owner into making a payment for something they didn’t order, or to agree to goods or services that they don’t need.

Typically, this trick involves an unscrupulous business sending realistic-looking invoices with what appears to be an official looking letterhead or logo. Other tricks include sending unsolicited facsimiles, emails or letters and follow-up invoices to entice businesses to subscribe to, and pay for, entries or advertising in online business directories or other publications.

These tricks generally rely on time-poor employees unwittingly paying invoices without checking if they know the sender or if they actually agreed to the advertising or directory listing.

This SBIN newsletter outlines a recent case taken against Spanish-based Company, European City Guide S L (trading in Australia as ‘Industry and Commerce’). Industry and Commerce sent misleading forms to business owners and later billed them for directory listings that the businesses did not realise they had agreed to. Importantly this case means that businesses that were misled by Industry and Commerce do not have to pay invoices issued by the company.

This newsletter also provides information on how you can avoid becoming the victim of this type of unscrupulous behaviour.

ACCC court action for false billing

The Federal Court recently found that Industry and Commerce misled Australian small businesses into signing up with its online business directory.

Industry and Commerce sent forms to small business owners which gave the impression that they were Australian Government representatives. These forms asked the businesses to update or check that the information on the Register of Business Information was “positively and correctly presented”. The forms also represented that the Register of Business Information was a free Australian Government record when this was not the case.

Unsuspecting businesses that responded to Industry and Commerce were then pursued for fees. Some businesses were also threatened with debt collection and legal action when they attempted to cancel their listing on the Register of Business Information.

As part of its judgment, the Federal Court ordered Industry and Commerce not to claim or seek payment from Australian businesses that received the misleading forms. This means that Australian businesses who were misled by Industry and Commerce do not have to pay.

Related media release:

How to protect your business

There are several steps you can take to protect yourself and your business. The ACCC strongly encourages businesses to:

• be wary of unsolicited offers, particularly those claiming to provide a free service, make sure you carefully read any fine print to fully understand the offer.

• make sure you know who you are dealing with before responding to any offer–do an internet search on the name of the product or company and verify contact and company details.

• look into the legitimacy and profile of a directory or publication – for example, ask for details of other local businesses who have previously listed or advertised and check with them that they received what they paid for.

• retain written records of authorisations for advertising or directory entries so that if you receive an invoice or a telephone call, you can go back to your records to check it.

• ensure that only authorised employees are responsible for payments and they should have ready access to important dates and suppliers. You should also keep these employees updated on any scam or unsolicited service that may target your business.

What to do if you think you have been targeted

If you feel you have been targeted by an illegitimate trader or if you have already given sensitive information to an illegitimate source, you should immediately report it to the police and the Scamwatch website. Scamwatch is the ACCC’s online resource to help people recognise, report and protect themselves from scams.

The ACCC’s Small Business Scams Fact Sheet provides tips to help protect your business from scams. You can get it from the ACCC website – – or from the ACCC Small Business Helpline on 1300 302 021.

Further information about protecting yourself and your small business from scams can be found on the Scamwatch website –

If you would like to subscribe to receive regular updates from the ACCC on small business issues please send an email with your contact details to

The ACCC also produces a newsletter which provides information on cartels, including tips for businesses on how to avoid engaging in or being the victim of cartel conduct. If you would like to subscribe to receive cartel-specific updates please send an email with your contact details to

Feel free to pass this information on to others who may find it useful.

Kind regards,

Education & Engagement

Compliance Strategies

Australian Competition & Consumer Commission (ACCC)

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