Internet Registry director fined for bogus invoice scam

Ontario man sentenced following Competition Bureau investigation

OTTAWA, June 30, 2004 — A Toronto man who targeted over 73,000 business and non-profit organizations across Canada with a deceptive mailout for the renewal of their Internet domain names has been sentenced to a $40,000 fine and a five-year prohibition order. The sentence results from an investigation by the Competition Bureau into Mr. Daniel Klemann and Internet Registry of Canada (IROC) under the misleading representations provisions of the Competition Act.

The deceptive mail piece informed recipients that their Internet domain name registration was about to expire and gave several options for renewal. It was designed to mislead recipients into believing that they were existing customers of IROC's domain name registration service. The mail piece also gave the general impression of being an invoice mailed on behalf of a department or agency of the Government of Canada in charge of the registration of Internet domain names.

According to the terms of the prohibition order, Mr. Klemann and 1480455 Ontario Incorporated, operating as IROC, are prohibited from engaging or participating in any activity involving the making of representations for the purpose of soliciting business for five years without first obtaining a positive Written Opinion from the Competition Bureau, pursuant to section 124.1 of the Act.

"The Bureau's investigation and the sentence in this matter shows that the Bureau will vigorously pursue perpetrators of deceptive mail scams that target consumers and businesses in Canada," said Raymond Pierce, Deputy Commissioner, Competition Bureau.

The Bureau suggests that consumers and businesses take a few steps to protect themselves:

• read their mail carefully;
• verify that any invoices are from regular suppliers;
• make sure the product was ordered before paying any invoice; and
• report any mail that appears to be false or misleading to the Competition Bureau.

Consumers who suspect they have been a victim of deceptive marketing practices are encouraged to contact the Bureau's Information Centre at 1-800-348-5358, or PhoneBusters' National Call Centre at 1-888-495-8501.

The Competition Bureau is an independent law enforcement agency. We contribute to the prosperity of Canadians by protecting and promoting competitive markets and enabling informed consumer choice.

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For media enquiries, please contact:

Maureen McGrath
Senior Communications Advisor
Communications Branch
819-953-8982, or 613-296-2187 (cell)

For general inquiries, please contact:

Information Centre
Competition Bureau
1-800-348-5358