The Austrian Federal Competition Authority (AFCA) has been made aware of an increasing number of cases in which small companies in particular are falling for scams involving bogus firms. These firms approach businesses in writing, sending what looks like an official letter and asking for sensitive information. Subsequently, or sometimes even in the first letter, the approached businesses are presented with a payment demand for a considerable sum ranging from EUR 800 to in excess of EUR 2,000 in some cases for a 24-month contract period. The AFCA has been informed of several such scams.
Complaints have so far been made about the following bogus firms:
- SolutionCom
- Media Solution
- City/Location map Upper Austria or Media & Print Group
- Nexus Reach Marketing GmbH
- Novo Ad Marketing SL.
Misleading letters (imposter scams)
The bogus firms usually send a letter by post. The written communication is presented to look like a form and/or might include a provincial coat of arms, which gives businesses the impression that the correspondence relates to an official public register. The letters are made to look official by referring to deliberately misleading terms, such as “Industry register” or “Company register”. The specific details of the terms of business are hidden deep in the small print. These might state that payment of a higher amount is required “to provide your company data online” or mention that “services are provided unofficially without an official mandate”.
Remedial measures
Apart from the general tools available under civil law, the Unfair Competition Act (UWG) may also be applicable in terms of remedial action. Many of the bogus firms are based abroad so prosecution can prove difficult. However, if a firm is based in Austria, it is possible to refer the case to the competent district administration authority (municipal authority in Vienna and district commissions elsewhere in Austria). These authorities are entitled to enforce the special offence pursuant to § 28a para. 1 of the UWG, according to which it is prohibited, in business dealings for competition purposes, to advertise for registrations in directories, such as the yellow pages, telephone or similar registers, by way of payment forms, money order forms, invoices, offers for correction or in a similar manner, or to offer these registrations directly in such a way without unequivocally and clearly highlighting in graphic form that such is solely an offer for a contract.
Scams may also be reported to the competent public prosecutor’s office or the police.
Exercising extreme caution
Companies should be wary of any such letters and proceed as follows:
- Read any received document carefully
- Do not sign or return the document
- If anything is unclear: obtain an opinion from a legal professional. To this end, you may contact the AFCA or consult the Austrian Federal Economic Chamber, the Austrian Association for the Protection against Unfair Competition, the Austrian Consumers’ Association or a lawyer.
The following institutions have already issued a warning:
- Austrian Federal Economic Chamber (WKO): https://www.wko.at/digitalisierung/werbekriminalitaet-wirtschaftskriminalitaet
- Association for the Protection against Unfair Competition: https://www.schutzverband.at/nui/detail_news.asp?zeitraum=v&newskatid=1&newsid=682
If you wish to lodge a complaint with the AFCA, please email us at wettbewerb[at]bwb.gv.at, or use our whistleblowing system or online complaints form.