Australian Company Fined Over 1 Million Euro for Domain Scam

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An Australian company has been €1.24 million (AU$1.95 million) for duping businesses out of over AU$2.3 million via a domain slamming scam.

The case was taken by the Australian Competition and Consumer Commission (ACCC) who claim that the company in question had sent out over 300 thousand fake renewal notices to Australian businesses.

For those of us who have been in the domain name business for a few years this kind of scam is not new. The modus operandi of companies operating these kind of scams is to send out thousands of invoices to companies that look like their genuine. In the case of the Australian company “Domain Name Register” they apparently added a slight twist, with the “trick” being to dupe the companies into registering a new domain name at a grossly inflated price. In the more common versions of this scam they are trying to get the registrant to transfer their domain at an inflated price.

“The Domain Companies misled businesses into thinking they were renewing payment for the business’ existing domain name, when in fact the business was paying for a new domain name,” ACCC Acting Chair Delia Rickard said.

“These sham operations target small businesses, capitalising on a lack of understanding of the domain name system or a busy office environment. We encourage businesses to be vigilant when paying invoices, especially if it is for a domain name registration service,” Ms Rickard said.

Mr Steven Bell, who was behind both companies  (Domain Corp Pty Ltd and Domain Name Agency Pty Ltd (also trading as Domain Name Register)) has been disqualified from being a company director for 5 years.  The court has also mandated that if they send out any notices in the future that they must include clear wording that they are not a renewal notice:

The Court made other orders by consent, including injunctions for three years against each of the Domain Companies and for five years against Mr Bell. These injunctions include a requirement that if any of the parties decide to send out further notices, each notice has to prominently include the words, “This notice does not relate to the registration of your current domain name. This is not a bill. You are not required to pay any money”.

More on the ACCC site.

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