International guidelines to combat fraud scams unveiled

A set of new international guidelines have been published today which will seek to reduce fake lottery schemes, prize draws and credit cons that operate across national borders.

The Organisation for Economic Cooperation and Development (OECD) launched the guidelines as part of their new drive to combat international scams and internet fraud.

Specific provisions include: establishing an early warning system to notify other countries of scams that may effect them; a national contact point to ensure clear channels of communication and co-operation; and a further look at the benefit of enabling enforcement authorities to gain monetary redress on behalf of consumers.

The guidelines also "seek to ensure" that every country has the necessary authority and powers to take action in cross-border cases, and sets the stage for future work on the issue of consumer redress.

Consumer Affairs Minister Gerry Sutcliffe welcomed the move, saying that tens of thousands of UK consumers had already been the victims of such scams.

"International scam operators strike quickly, victimise thousands of consumers in a short period of time and then disappear along with the proceeds of their cons," he said.

John Vickers, Office of Fair Trading chairman, said: "Cross-border fraud against consumers, such as deceptive telemarketing, is a growing problem, costing UK consumers many millions of pounds a year. The OFT will play a full role in working with overseas partners to put a stop to these unacceptable practices."

The most widely known scam is the fake Canadian lottery which, between December 2000 and January 2003, saw UK consumers contacted by people claiming to be Canadian customs agents. They were advised to send money for customs fees and taxes via a wire transfer from their UK bank account to a bank in Toronto. The fraudsters collected over CAN$30,000 from just five UK consumers, although there were believed to be many more. In this case, the Toronto police, in conjunction with other enforcement authorities, were able to find and arrest these wrongdoers.

Another was the Canadian fraudulent telemarketing scam whereby thousands of telephone calls were made to people in the US and the UK by criminals purporting to represent the Nevada Gaming Commission. Upwards of CAN$5 million was made in this way.

Other types of scam that have come to the attention of enforcement authorities include - alleged 'psychics' and clairvoyants; misleading health and diet claims; misleading prize draws (including some that claim to be UK based but have a PO Box hiding an overseas connection); and timeshare and holiday club scams, which are notorious for using high-pressure selling techniques and evading consumer protection laws.

A UK campaign to stop consumers being ripped off by postal scams, such as bogus prize draws and competitions was launched by the DTI on 24th July 2002. A leaflet tells consumers what to watch out for and can be ordered free from DTI on 0870 1502 500.

(GMcG)