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New Taskforce warning on scams - Delete it! Destroy it! Hang up!

Media Release

13 February 2006

Eighteen agencies across Australia and New Zealand have joined forces to combat consumer fraud, warning consumers about the scams that affect thousands of Australians every year.

The Australasian Consumer Fraud Taskforce today launched a four-week campaign today to help people to protect themselves from becoming victims of scams.

'Crimes involving fraud cost Australians millions of dollars each year. The best protection against scammers is to hit the delete key, hang up, or throw it in the bin', Dr Toni Makkai, Director of the Australian Institute of Criminology, said.

'As regulators, advocates, educators and other consumer protection agencies we see the devastating effects which scams have on people. Our combined experience and knowledge has shown that the best way of combating consumer fraud is to educate people and change their behaviour before they get caught out', Dr Makkai said.

Dr Makkai said Australian agencies receive thousands of complaints, and often calls for help, each year about scams received by mail, telephone and email. Our key message is to 'delete it, hang up and destroy it'. Consumers are their own best defence, and should always err on the side of caution.

The Taskforce, chaired by the Deputy Chair of the Australian Competition and Consumer Commission, Louise Sylvan, is working on outreach strategies, prevention strategies and research.

'Scammers are becoming increasingly sophisticated in the way they target people. We need consumers to resist these approaches and refuse to respond', Dr Makkai said.

The Taskforce identified that the top scams in 2005 included

  • lottery scams
  • advance fee scams (such as Nigerian letter scams and pyramid schemes);
  • email phishing scams and;
  • cold calling scams.

Scams are a global problem with many emanating from international jurisdictions, making them difficult to take action against.

'Consumers who respond to these scams nearly always lose their money, and most never see it again', Dr Makkai said.

Australians became the victim of the third biggest pyramid scam, in terms of the amount of money lost, when consumers bought about 156,000 Skybiz 'webpacks' amounting to nearly A$20 million between 2001 and 2003.

Australians have also lost considerable sums to advance fee scams, such as letters and emails purporting to come from Nigeria. One Sydney victim lost more than A$700,000 while an Adelaide businessman lost more than A$2.3 million to such a scam. In another case, a Japanese businessman is said to have lost US$5 million.

The key characteristics of 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 and no risk; and
  • it sounds just too good to be true.

Background

Consumer scams are crimes of dishonesty such as forgery, counterfeiting, on-line deception, and theft that are targeted at people who seek to purchase goods and services. Potential victims can be those who use computers and the Internet, older people, those who use professional advisers, and people who use mobile phones.

As part of a whole of Government 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:
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
New Zealand Government: NZ Commerce Commission; Ministry of Consumer Affairs
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.

Taskforce partners

Taskforce members are joined in communicating with Australian consumers about scams by a range of community, non-Government and private sector organisations. Visit http://www.scamwatch.gov.au/content/index.phtml/itemId/694357/fromItemId/693926#h2_106 for a list of Taskforce partners.

Consumers who think they've spotted a scam can check it out the ScamWatch website at http://www.scamwatch.gov.au/ which has lots of information about scams and a number for reporting scams: 1300795995.