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All of those details were meticulously data-based and prepared, then sold globally to anyone and everyone willing to stump up top-dollar for a top-notch, current, detailed, properly formatted marketing list of teenaged consumers. Lists like this are worth thousands per sale. Another fraudulent revenue stream is realised.
How they were
eventually stopped
The police could do nothing. The victims could do nothing. In the end, it was the media that came to the rescue. When the story broke, it presented sufficient information to the market that everyone became instantly aware of who these people were, and the basics of how they were operating. They immediately went underground.
The Department of Fair Trading compiled sufficient evidence to take what little action they could, and the web sites were all taken off the air.
The perpetrators got away with it. No fines, no prison, no criminal case, no civil case. They just took the money and slipped into the darkness.
What you can do to
prevent this sort of
thing reappearing.
There are bona fide, honest, reputable operators creating and delivering fantastic school formal products and services out there. You only need to follow these few simple steps to know for certain whether you’re dealing with one.
1/ Visit their offices. If there’s some excuse why you can’t, or there isn’t one, this should be viewed with suspicion. If you do get into an office environment, ask for documents such as valid ASIC or Fair Trading certificates to prove that the company is properly registered. You can also check these things on the web site at www.asic.gov.au
2/ Check with the venue. If you find venues such as branded hotels advertised in the companies marketing materials, or on their web site, don’t be afraid to call the functions department of
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This offer was conveyed to the hotels, who accepted this arrangement. They each received a bank cheque for $1000 for the first payment as part of the agreement. From that point, they never saw another cent.
"What may further shock you is that the scam, although having succeeded perfectly, does not stop here. There’s more"
When they further complained to the police that things had again gone wrong, both the police and the victims came to the stark realisation that they’d been scammed again. You see, once an arrangement for payment has been offered, accepted and a single payment made, the matter ceases to be a criminal one, and becomes a civil one. From that point, the police could do nothing more and it became up to the hotels to pursue the scam company with a lawsuit, except of course by this time, they’re already gone, along with the rest of the money.
8/ The cherry gets a third bite
The scam described above was simultaneously taking place in all states each year. Taken on average prices per ticket, per event, per year of operation, could be estimated to have netted the criminals as much as $20 Million during the time it ran.
What may further shock you is that the scam, although having succeeded perfectly, does not stop here. There’s more.
Any marketing or advertising expert will tell you that the teen market is the toughest demographic to capture. With email addresses and mobile phone numbers changing so frequently, and such a young and emerging market having little or no online purchasing history, any properly formatted database that contains several contact methods and is current, is absolute gold on the open market.
Cast your memory back to the printed envelopes handed to all of the kids to stuff with cash. Each had a form that each person filled in with their personal details.
dodgy company directly.
When it comes down to the final 48 hours prior to the event night, the scammer pays the hotel using a credit card, and the payment clears so the hotel is happy to proceed.
On the day of the event, the scammer calls his credit card company and reverses the payment, claiming that there has been some fraud or mistake. The payment is reversed but the hotel will not know about this for anything up to 30 days, by which time the event has already happened, the credit card account has been closed and the scammer is gone.
None of the suppliers will be paid and when they search for the company, they find nothing.
To sprinkle salt on the wound, photos from the successful formal, taken by the photographer who never received payment, at the venue that never received payment, appear on the scammer’s web site as a record of a successful job well done attracting even more business.
In either the case of A or B, doing the formal or not doing the formal results in the same thing. The scammer absconds with every cent of the untraceable money.
7/ Avoiding arrest
This is fraud. No matter which way you dissect this activity, no matter how it’s conducted, someone is being fraudulently separated from their rightful dollars. For this reason, one would expect that putting a stop to it may be as simple as picking up the phone and calling the police, right? Well, this isn’t as easy as you may first assume.
In the case of hotels that were defrauded (a few of them being big name, internationally branded establishments that you’d know) they of course called the Police Fraud Squad and complaints were made. Investigations were undertaken and in short order, the scammer responsible for liaising with the hotels was questioned.
During this questioning, the excuse given to the police was that there had been some kind of banking error, and that he would arrange to pay for the events by way of $1000 instalments weekly until he could investigate matters with his bank, at which time the remainder would be paid in full.