Issue Date:  -  Thursday, 16 October 1997

Government to take part in world-wide scheme to combat phony Internet schemes

The State Government is to participate in a world-wide sweep of the Internet today in an attempt to educate and warn consumers and operators of illegal schemes.

Fair Trading Minister Doug Shave said the national sweep was organised following two similar events in the United States and Canada which had been highly successful.

Mr Shave said officers from the Ministry of Fair Trading would be concentrating their search on 'get rich quick' schemes promising easy money.

"We are searching for pyramid selling schemes and chain letters," the Minister said.

"Chain letters ask consumers to send money to people on a list, then to add their name to the list and forward it to several friends with the same instructions.

"So-called money making clubs, where new members are recruited to a club which charges a membership fee, are also being targeted.

"Other schemes we are interested in are business 'opportunities' and phony prizes and lotteries.

"For example, a site that makes the claim: 'Make $500 per week stuffing envelopes at home' is of particular interest, as are schemes requesting investment in items such as rare coins, jewels, ostrich eggs etc, where astronomical returns are promised.

"Lotteries may be phony if they require 'winners' to send money to cover 'administrative costs' or require the winner to perform some act, like travelling overseas to claim the prize.

"Prizes may be phony if they require payment of amounts for delivery which end up being more than the value of the actual prize.

"People should realise that if a proposal sounds too good to be true, it probably is. They should consider carefully to whom they give their cash and would be well advised to get some independent advice.

"This sweep will educate international Internet traders offering 'get rich quick' schemes about behaviour that is illegal and warn consumers about what sort of scams to look out for."

Co-ordinated nationally by the Australian Competition and Consumer Commission, the sweep involves all State consumer affairs departments and agencies in 31 other countries.

The national results of the sweep will be compiled by the ACCC and used with international results for a follow-up sweep to determine the impact of the operation and the educational messages sent.

Local results will be released by the WA Ministry of Fair Trading after the sweep concludes at 11am.

Media contact:
Anabel Gomez
Tel: (08) 9366 0300