Scams, shams and small business

Peter Kell
Peter Kell

On Monday 12th September 2011 in Canberra more than 70 business, industry association and government representatives attended the Australasian Consumer Fraud Taskforce forum Small business and scams: sorting out the shams.

Academics, compliance and enforcement experts and small business specialists, including ACCC Deputy Chair Dr Michael Schaper, shed light on their experience of scams, the sophisticated techniques employed by scammers to target small business and how to deter those methods.

Opening the event, ACCC Deputy Chair and Taskforce Chairman Peter Kell said scams were no longer the domain of “dodgy guys on the street corner”, but were carried out by well-resourced and well-trained international criminal networks.

“Scams aren’t going to go away – they are part and parcel of the modern online environment,” Mr Kell said.

“The purpose of this forum is to highlight how they are being perpetrated and give some insight on how we can effectively respond.”

Dr Schaper said the ACCC was unable to say how many small businesses had been hurt by scammers, and the dollar and social impact, because small businesses weren’t reporting.

“There are very few figures on scams against small business in Australia because they tend not to report the incident,” he said.

“We need to change that because we know they are being targeted – both as businesspeople and as consumers – and because they don’t have large profit margins, even a small scam can have a big impact.”

Small-business expert Dr Paull Weber, from Curtin University, presented on his early research into why small business is so vulnerable to attack.

His recent study of Western Australian businesses indicates that two-thirds of established businesses had been scammed in the 12 months preceding his research and a further 25 per cent of small businesses weren’t even sure if they had been scammed.

He said that although it was only a small sample, his research highlighted an “alarmingly high rate of owner ignorance”.

COSBOA Executive Director Peter Strong commended the ACCC for hosting the forum.

“These types of events are critical in getting the message out to small businesses. It’s important to raise awareness of the environment in which scammers operate.

“I also appreciate that the ACCC took the time to focus specifically on small business because they have very different needs and issues than larger companies,” he said.

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