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Scams and fraud

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Accommodation booking scams

These scams typically originate as emails from overseas sources. Some tell-tale signs that you may be dealing with a scammer include:

• They will not refer to your accommodation title in their correspondence (that's because it's a generic email sent out to masses of people)
• The email originates from a free email service like gmail.com, hotmail.com or yahoo.com
• They request stays that are quite lengthy - often a week or more
• They are very flexible with the booking dates
• There is no request for pricing details or discounts - they are happy to pay whatever price you want to charge
• They have no questions about the actual accommodation, facilities available, or how to get there
• They claim to be from the U.K. and supply a phone number that begins with the U.K. country code of 44 followed by a string of numbers starting with 70 - this is actually a personal forwarding number that can redirect the call to any phone anywhere in the world (known as a "UK global redirect")

The scammer may then employ a number of methods to defraud you of money.

Money transfer scam

You receive a booking and are asked to deduct from the supplied credit card the cost of accommodation, plus an extra amount (typically several thousand dollars) to cover other services they are booking as part of their trip. You'll be given some excuse as to why they can't pay for those additional services themselves, and you'll be asked to send those extra funds to a third party via Western Union or a bank transfer.

What may be happening is that you've been given stolen credit card details and you're being tricked into transferring funds from it to the scammer directly (i.e. the cost of their supposed additional travel arrangements). When the real credit card owner eventually disputes the transaction and the payment is reversed, you will be required to make a full refund. This full refund includes the the extra amount you charged for those additional travel arrangements, which is now in the hands of the scammer and which you have to fund out of your own pocket.

To avoid these scams, only charge credit cards for just the services you're supplying, and never act as an intermediary by billing credit cards and transferring the funds to someone else.

Booking cancellation scam

You receive a booking and it is paid for using a credit card. The booking is cancelled shortly afterwards, and you're asked to refund some or all of the payment by sending the funds via a bank transfer or some other method.

What may be happening is that you've been given stolen credit card details. However, the scammer is hoping that before you realise that, you've transferred your money into their own account.

In cases like this, you should refund the credit card transaction back to the actual credit card that was initially used. Otherwise you'll lose not only the money you billed to the credit card, but also the money you sent to the scammer.

When accepting credit card payments, you may wish to enter the first 6 digits of the card into the Bank Identification Number database to check which bank issued the card and in which country. If someone portrays themselves as coming from one country and supplies credit card details issued by a bank in another country, then you should be very suspicious of their intentions.

Cheque overpayment scam

You receive a booking, but instead of receiving the amount agreed on, you receive a cheque well in excess of that figure. You are asked to immediately refund the overpayment via a bank transfer or some other method.

In this case, you may have been given a cheque that cannot be honoured. However, it will usually take a few days after you deposit it for your bank to notify you about this. In the meantime, you've given the overpaid amount to the scammers, leaving you with no booking and out of pocket by the overpayment amount.

To avoid this happening, ensure cheques have been cleared by your bank before transferring any funds back to the sender.

Advertising scams

During 2010, companies using names similar to "Yellow Pages" and a variation of the well-known walking fingers logo, targeted Australian businesses, requesting payment for a listing in their directories which people assumed was the Yellow Pages directory produced by Sensis and Telstra. As it turned out, businesses were being charged for a listing in a little used directory which was produced overseas. The Australian Competition and Consumer Commission (ACCC) took court action, resulting in a multi-million dollar fine being imposed. Read further details of the Yellow Pages scam.

Never pay for an advertisement unless you are sure it is from a legitimate organisation and that you have authorised it. Ask for proof of authorisation if you're unsure. It's often wise to keep an updated list of advertisements you do take out so that at a glance you can see who you are currently advertising with.

If you are taking out new advertising, ask for proof of publication before paying any bill. If that's not possible, ask to see a sample of the publication that your advertisement will appear in. Use Google to search for the word "scam" followed by the website or publication name. This may uncover any bad dealings people have had with the advertiser in question.

Hosted Accommodation Australia have published a list of advertising scams that have targeted their members in recent times.

Booking agent scams

The operator of the holiday booking website www.VicHolidays.com.au was prosecuted in 2011 for taking payment from guests for accommodation but not forwarding payment to the actual accommodation provider, and a number of other incidents of fraud against both property owners and guests. Read the full details of the VicHolidays.com.au scam provided in the South Gippsland Sentinel-Times newspaper.

Website domain registration scams

These organisations are able to find out the contact details of a website's registered domain owner (such as your name and address) by consulting the Whois database and then typically posting you out an official looking letter in the mail which may closely resemble an invoice to be paid.

Domain transfer scam

You receive a letter advising that your domain will expire soon and that you should take immediate steps to renew it. This letter is typically sent out in advance of your own registrar's renewal reminder, so that you see it first and to confuse you about which organisation you have registered your domain with.

The offer to renew your domain typically comes with a special deal whereby you receive a large discount or free gift of significant value if you complete your renewal by a specific date.

View an example of such a letter (personal details blanked out) by Domain Renewal Group.

What is happening is that a domain registrar that never registered your domain name to begin with is trying to steal your business from your original provider. Their so-called "renewal" process actually involves transferring the registration management to them, in addition to renewing the registration. You will typically be charged a very hefty renewal price, sometimes up to 10 times the general market rate. The offer of a free gift (typically a personal item of electronic equipment, such as an iPod) aims to get you to quickly renew to claim your bonus without thinking too much. The value of the free gift does not come close to offsetting the inflated renewal costs offered to you.

Accommodation providers who have registered a domain name for their website should always check their records as to who their original domain registrar is. Don't just assume that a renewal you receive is actually coming from your current provider as anyone could write a letter to you offering to renew your domain.

Domain registration scam

You receive a letter advising that your domain name is available for registration and what appears to resemble an invoice with the offer of a free gift if you pay the account by the due date.

View an example of such a letter (personal details blanked out) by Domain Register.

Unlike the domain transfer scam, they are not trying to transfer your existing domain name to their management. Instead, they are trying to get you to register an additional domain with them (one that that they have selected) which is similar to your existing domain name. For example, it may be a .com or .net.au version of your existing .com.au.au domain. The offer to register is aimed at either convincing you into believing they are renewing your existing domain, given that the name is so similar, or that you should in fact register the similar name to protect your internet identity. The registration prices are very excessive and are not offset by the value of the free gift offered.

Before deciding to register a similar domain to an existing one you own, you should shop around for the best deal and ensure that your selected domain registrar has been accredited by auDA - the Australian domain name administrator. See the official list of accredited domain registrars and visit each registrar's website to compare domain name pricing.

More about scams