Australian Regulator Takes Action Against Domain Registration Companies

Australian_Competition_and_Consumer_Commission_ACCC_logoThe Australian Competition and Consumer Commission (ACCC) is taking action against 2 fraudulent businesses that have been sending out unsolicited notices to businesses. The ACCC alleges these notices look like renewal invoices for the business’s existing domain name but instead were for the registration of a new domain name, at a cost ranging from A$249 to $275.

The businesses the ACCC has instituted proceedings against are Domain Name Corp Pty Ltd and Domain Name Agency Pty Ltd (also trading as Domain Name Register). The ACCC is also alleging that the sole director of both the Domain companies was involved in the conduct.

From November 2015 to at least April this year, the Domain Companies sent out approximately 300,000 unsolicited notices to businesses.

“The ACCC alleges that because these notices looked like they were renewal invoices, many businesses paid them thinking they were simply renewing the domain name for their business. The ACCC is alleging that the businesses were instead unwittingly signing up for a new domain name ending in either a .net.au or .com suffix that the business might not have needed or wanted,” ACCC Deputy Chair Dr Michael Schaper said.

“It is alleged that the notices sent out by the Domain Companies offered domain names that looked very similar to the business’s current domain name. This detail and the fine print disclaimer were easily missed.”

“The ACCC believes that Australian businesses and organisations paid approximately $2.3 million to the Domain Companies as a result of receiving the notices,” Dr Schaper said.

The ACCC is seeking declarations, injunctions, pecuniary penalties, corrective advertising, disqualifying orders against the director and costs.

The ACCC’s Scamwatch website has previously warned about unsolicited domain name registration offers (link is external).

Consumer Affairs Victoria has produced a video (link is external) that provides further information to businesses about unsolicited domain registration offers.

Unsolicited domain name registration offers are a type of false billing scam (link is external). In 2016, more than 14,500 individual reported to a combined loss of more than $650,000 to false billing scams.