The Federal Court has ordered that Domain Corp Pty Ltd and Domain Name Agency Pty Ltd (also trading as Domain Name Register) pay combined penalties of $1.95 million for breaching the Australian Consumer Law.
From November 2015 to at least April 2017, the two Domain Companies sent out approximately 300,000 unsolicited notices to businesses, which looked like a renewal invoice for the business’s existing domain name. Instead, these notices were for the registration of a new domain name at a cost ranging from $249 to $275.
The Court declared that the Domain Companies made false and misleading representations and engaged in misleading and deceptive conduct in sending these notices. Australian businesses and organisations paid approximately $2.3 million to the Domain Companies as a result of receiving the notices.
“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.
Any business or consumer receiving a renewal notice for a ‘.com’ or ‘.net.au’ domain name should check that the notice is to renew their proper domain name.
“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.
The Court also declared that the sole director of both Domain Companies, Mr Steven Bell (also known as Steven Jon Oehlers), was knowingly concerned in, and a party to, the conduct.
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”.
The Court also made an order disqualifying Mr Bell from managing a corporation for five years and ordered him to pay costs to the ACCC, fixed at $8,000.
Visit www.scamwatch.gov.au to learn more about scams targeting businesses.