Australian's register scam nets 'bucketloads' of cash
5:00 AM Monday Sep 20, 2004
An Australian entrepreneur has been sprung after duping an estimated 2000 New Zealand tradespeople into paying almost $200 each to register on his website.
Gary Solah got the jump on the Government as it prepares to introduce mandatory licensing of trades.
His Christchurch company sent official-looking letters to thousands of businesses urging them to join the New Zealand Trade Register to ensure their survival.
Names and addresses were apparently obtained through the Yellow Pages.
Many paid the $196, and were listed on the company's online register.
Solah was busted operating a similar scheme in Australia.
The Certified Builders Association had scores of calls from builders wanting to know if the register was the official version.
"He would have made bucketloads of money," said chief executive Garry Shuttleworth.
"It was very much opportunistic. The letters looked very genuine and it was designed to deceive right from the outset."
Mr Shuttleworth believes up to 2000 plumbers, electricians, builders, roofing contractors, bricklayers and others could have fallen into the trap.
The Commerce Commission agreed the letter was misleading, and took Solah and his company, Trade Registrations New Zealand, to court for breaching the Fair Trading Act.
In Christchurch District Court last month, it argued that the use of an official-looking name and logo, and references to Government departments, implied that the register was linked to the state.
The letter's showing a Wellington mailing address and 0800 phone numbers reinforced the impression of Government involvement.
But there was no Wellington office or staff. Mail sent to a Wellington post box was redirected to a post box in the Christchurch suburb of Riccarton, and then to a third box in suburban Sydenham.
That box was cleared by a Trade Registrations employee.
Solah denied that he or his company had any intention to mislead. His lawyer argued that the words "trade register" did not apply exclusively to the Government.
In his reserved judgment, Judge Robert Kerr ruled that false and misleading representations were made. He found Solah and the company guilty on 10 of 15 counts under the act.
Solah and Trade Registrations will be sentenced in December.
Banned and warned
* In 1997, Australia's Federal Court issued an order preventing Gary Solah and his Gold Coast business from operating, publishing or promoting any directory.
* Solah was also ordered to refund money to customers.
* Last year, Western Australia's Consumer Minister, John Kobelke, gave a public warning about Solah's web-based Australian Trade Register.