Trans-Tasman taskforce takes up the fight against scams

22 February 2006
The Australasian Consumer Fraud Taskforce has launched a trans-Tasman campaign to inform consumers about the most common types of scams and how to recognise whether an offer is genuine or false.

Consumer Affairs Minister Judith Tizard announced today the Ministry of Consumer Affairs and the Commerce Commission are taking up the fight against those who scam consumers as part of the Australasian Consumer Fraud Taskforce, along with 16 agencies from across Australia.

Each year it’s estimated that millions of dollars leave Australian and New Zealand shores to line the pocket of professional fraudsters.

“The amazing thing is that the scams that succeed in getting consumers to part with their money are well known and documented. Yet, consumers continue to respond, despite warnings from government agencies, police and financial institutions,” Judith Tizard said.

“Scams can have a devastating effect on people. One of the best ways of combating consumer fraud is to give people the information to help prevent them being caught out”, said Judith Tizard.

Last year, an elderly Auckland woman’s involvement in a $2 million Nigerian scam (or advanced fee fraud) sent her to prison for seven years and had a shattering effect on other family members, friends and business associates. This case was an example of how a scam can take hold of someone’s life, with the woman and her husband still holding out hope that the scam will turn out to be a reality and provide the untold wealth it promised, despite evidence to the contrary.

Scams are a global problem and are becoming increasingly sophisticated in the way they target people. The increasing use of email and the internet to locate potential victims, and as a vehicle to perpetrate their crimes, makes it easy for scammers to send out anonymous emails worldwide, making it difficult for the enforcement agencies trying to catch them. Consumers need to look closely at any unsolicited information that is sent to them, resist these approaches and refuse to respond.

Key characteristics for consumers to look out for in identifying a scam include:

• it comes out of the blue
• it sounds like a quick and easy way to make money
• it tells you there is almost no effort or risk, and

it sounds just too good to be true.

The top scams in 2005 identified by the Commerce Commission and the Ministry of Consumer Affairs included:

• International prize and lottery scams
• ‘Get Rich Quick’ schemes such as work from home schemes, investment scams, pyramid selling, and advanced fee and Nigerian scams
• ‘Phishing’ emails from criminals pretending to be your bank in an attempt to obtain your personal details and passwords.

The Ministry of Consumer Affairs operates the Scamwatch website. This site provides consumers with information on types of scams currently operating, and links to New Zealand and global enforcement agencies that consumers can report scams to.

“My advice to consumers is to resist the temptation. Be wary. Do not respond to these scams. Do not send money to collect supposed winnings from lotteries that you didn’t enter. Don’t reply to letters promising you rich returns. Do not click on links in emails and provide personal information, and do not believe people who call you up to offer a great investment deal.

“All of these scams promise much and deliver nothing. The key message for consumers is if it seems too good to be true, it probably is,” said Judith Tizard.

Background

Consumer scams are crimes of dishonesty such as forgery, counterfeiting, on-line deception, and theft that target people who seek to purchase goods and services. Potential victims can be those who use computers and the internet, older people, people whose financial situation makes them interested in ‘get rich quick schemes’, and people who use mobile phones.

As part of a trans-Tasman approach to combat consumer fraud and scams targeted at consumers, the Australasian Consumer Fraud Taskforce was established in March 2005 and comprises 18 government regulatory agencies and departments in Australia and New Zealand.

Agencies participating in the Taskforce are:

• New Zealand Government: Commerce Commission; Ministry of Consumer Affairs.
• Australian Government: Attorney General’s Department; Australian Bureau of Statistics; Australian Communications and Media Authority; Australian Competition & Consumer Commission; Australian Federal Police (represented by the Australian High Tech Crime Centre; Australian Institute of Criminology; Australian Securities & Investment Commission; Department of Communications, Information Technology & the Arts
• State and Territory Governments: Australian Capital Territory – Office of Fair Trading; Consumer Affairs Victoria; New South Wales – Office of Fair Trading; Northern Territory – Department of Justice; Queensland – Department of Tourism, Fair Trading and Wine Industry Development; South Australia – Office of Consumer & Business Affairs; Tasmania – Office of Consumer Affairs & Fair Trading; Western Australia – Department of Consumer & Employment Protection.

Consumers who think they’ve spotted a scam can get more information and report them on the Scamwatch website. Consumers can also report any scams to the Commerce Commission website.