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Suspicious transactions: are your customers paying this business?

BIScom Subsection: 
Nigel Morris-Cotterill

Australia: the Australian Consumer and Competition Commission has issued a public warning notice about the conduct of Postage Ink Pty Limited in relation to the unsolicited supply of labels and ink cartridges and other consumables for postage meters to business customers.

The ACCC’s action follows complaints from businesses which use postage meters, also known as franking machines, and which had been contacted by Postage Ink in respect of unsolicited sales or payments.

In issuing the public warning notice, the ACCC has reasonable grounds to suspect that Postage Ink’s conduct in engaging in the supply of unsolicited goods by sending postage meter ink cartridges to businesses which had not ordered them, and subsequently seeking payment for the ink cartridges and other consumables for their postage meter, may breach the Australian Consumer
Law (ACL).

The ACCC also has reasonable grounds to suspect that representatives of Postage Ink contacted various businesses and, in breach of the ACL, falsely represented that Postage Ink had an ongoing supply relationship with them, leading their staff to place orders with Postage Ink.

“We have issued this public warning notice to alert businesses about the alleged conduct by Postage Ink, and to encourage all businesses using postage meters to put measures in place to protect themselves from similar conduct,” ACCC Deputy Chairman Delia Rickard said.

“If you receive goods that you did not order, you do not have to pay for them and, if the sender does not collect the goods within three months, you can keep them or dispose of them without having to pay for them.”

“Under the Australian Consumer Law, businesses must not engage in false, misleading or deceptive conduct or assert a right to payment when they know they have no right to do so,” Rickard said.

“The ACCC recommends that all businesses using postage meters alert their administrative staff to the possibility of unsolicited sales calls, the supply of items that were not ordered and false invoicing for postage meter supplies; and post a copy of the ACCC’s warning notice where those staff can see it.”

The Public Warning Notice has been issued because the ACCC has reasonable grounds to suspect that Postage Ink’s conduct may constitute a contravention of sections 18, 29 and/or 40 of the ACL; is satisfied that one or more business has suffered or is likely to suffer detriment as a result of the conduct; and is satisfied that it is in the public interest to issue the notice.

The public warning notice is available at Postage Ink Pty Ltd https://www.accc.gov.au/public....

Postage Ink is a business registered in NSW and Mr Majed Homsi is its sole director.


This is an example of an oldie but goody coming back: it was common in the 1980s but fell out of favour when directory fraud, which required no investment by the seller other than a stamp and paper, became popular. In a variation, a simple fraud of sending invoices or demand letters relating to goods never delivered improved profitability for criminals and, with the near-zero cost of e-mail that version of the scam developed massively during the 1990s. Directory fraud continues to this day, usually with a note saying that the document which is obviously a demand note is not a demand for payment.

This case raises the thorny question of when money laundering starts: is it when the payment leaves the victim's account? If so, do you have a duty of care to the customer to block the transactions and/or to make suspicious transaction reports when you are, as this notice does, makes public a specific and avoidable threat? Are the perpetrator's bankers now required to file retrospective suspicious activity reports in relation to transaction on the accounts and to freeze any funds that may arrive in it?

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