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HomeNEWSSmall businesses targeted by directory scam

Small businesses targeted by directory scam

Commerce Commission general manager of competition Kate Morrison says it’s received a number of complaints about Corporate Portal New Zealand, as well as similar scams.

Another recent scam by an organisation called the New Zealand Small Business Assistance Centre used similar tactics to coerce small business owners into giving it money.

“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,” Morrison says.

The letter tells businesses they must submit their details by a deadline date or be removed from the Corporate Portal website.

Morrison says it gives business owners the impression that the business is already listed on the directory and that its details need updating. It also makes them think it’s a free service.

“In reality, filling out the form and posting back their business details signs them up to a $1,411 annual subscription to a basic online directory, for at least three years,” she says.

Once a business is a member of the directory, the terms and conditions are difficult to wrangle out of.

The Corporate Portal also says it has the right to increase the annual fee without consulting members of its directory.

Morrison says it’s important to remember that websites with ‘nz’ in the web domain don’t have to be based here. Corporate Portal’s address is based in Germany.

The Ministry of Business Innovation and Employment (MBIE) advises those targeted to report any letters received here.

It also has a number of tips for small businesses to protect them from scams, including:

  • Limit the number of people in your business who have authority to make purchases or write orders.
  • Keep written records of all orders and purchases.
  • Reconcile all invoices against actual orders. Ask for proof of purchase and check with colleagues to make sure that you have received what you paid for.
  • If an invoice seems to reference an advertisement or directory entry you genuinely made, make sure that all of the details add up. False billing scammers may use your real advertising as the basis for their fake invoices, eg company name, address and bank details.
  • Deal only with people and companies you know and trust.
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