Spot the scam

By LINDA WHITNEY FOR MAILONLINE
Updated: 19:00 EST, 5 March 2004

 

A SCAM that has fleeced thousands of small businesses is still going on, despite authorities being aware of it for many years.

Two years ago Money Mail warned small businesses about fake data protection agencies sending out letters warning businesses of penalties for failing to register under the Data Protection Act. They enclosed official-looking registration forms, and charged £95 for the service.

They are still at it - only now they are charging £135. But the real cost of registration is just £35, and if your firm needs to register - many small firms don't - you can easily do it yourself.

More than 200 companies a month fall victim to the scam which has cost British businesses thousands of pounds over the past two years, according to Richard Thomas, the Information Commissioner who oversees the Data Protection Act.

While offering registration as a business service is not illegal, and many of the companies do register their victim's businesses with the Information Commissioner's Office (ICO), business owners are being unnecessarily alarmed by the letters and paying over the odds for the service.

The ICO's website also warns that individuals posing as 'collectors on behalf of data protection' are turning up on businesses' doorsteps, requesting payment
_________________________

• PETER WALKER has a small business hiring out horse-drawn carriages for weddings, films and picnics. Peter (pictured with Bracken) refused to be taken for a ride by data protection scammers. 'Recently I got an 'Urgent Notice' letter from something called the Data Protection Agency,' says Mr Walker, 67, from East Brabourne, Kent. 'It said my business was not registered under the Data Protection Act and warned that I could face a fine unless I returned the enclosed forms immediately, along with an annual registration fee of £135.' But he was suspicious, having received a similar letter about two years ago, asking for £95. 'At that time I wrote back and said I did not think I needed to be registered, and heard nothing more. 'Now I want to warn others that this scam is still going on.'
_________________________

for data protection registration. These 'collectors' produce identification cards, but they are not ICO officials.

So what is the Information Commissioner doing about it? 'Although I do not have the power to take action against these agencies myself, I continue to work with the relevant authorities to explore legal action,' says Mr Thomas.

The relevant authority is the Office of Fair Trading (OFT), which has tracked down several of the people behind these scams and, using the Control of Misleading Advertisements Regulations, asked them to give an undertaking that they will stop sending out the letters.

If they refuse, the OFT can get a court injunction restraining them from being involved in the business. So far it has issued at least two. Breaching an injunction means an unlimited fine or up to two years' imprisonment.

An OFT spokesman says: 'The problem is that there are many companies using the same or similar names but they are not operated by the same people. We have to track each one down individually in order to take action.'

He added that while the OFT tries to hit a moving target and the ICO has no power to stop the scam, the only answer is publicity - so watch out for this scam.

'If you receive a letter out of the blue demanding more than £35 to register under the Data Protection Act, it is a scam,' says Mr Thomas, the Information Commissioner.

If in doubt, call the ICO hotline 01625 545 740 or see www.informationcommissioner.gov.uk, 'bogus agencies' section.

The ICO states that you do not need to register if: your business processes personal data only for staff administration, such as the payroll; for advertising, marketing and PR for just your own business; and for your own accounts and records.