Competition Bureau investigation results in sentencing for phoney invoice scam

OTTAWA, May 21, 2004 — A Toronto-area man was sentenced to a $60,000 fine and a prohibition order today for his role in the Yellowbusiness.ca phoney invoice scam. Mr. James Tetaka was sentenced as a result of a Competition Bureau investigation under the false or misleading representations provisions of the Competition Act into 1473253 Ontario Incorporated, operating as Yellowbusiness.ca. Peter Kuryliw, also of the Toronto area, was previously fined $30,000 for his role in the scam which targeted over 40,000 Canadian businesses and non-profit organizations with a deceptive mailout for an Internet directory.

The mailout, dated May 25, 2001, asked recipients to send a payment to a postal box in the Toronto area for an Internet business directory that listed the details of their organizations. Bureau investigators found the mailings were made to appear as invoices from an existing service provider, such as Bell Canada or the Yellow Pages, requiring recipients to pay $85.55 when in fact they weren't customers.

As part of the investigation, the Bureau and Canada Post seized mail containing an estimated $700,000 in payments for the fraudulently deceptive mail pieces.

The Bureau's investigation revealed that the 40,000 businesses and non-profit organizations targeted in this scam were previously victimized for similar mail-outs in the year 2000. Victor Serfaty and the Benlolo brothers, Alan, Elliot and Simon, were recently convicted in Toronto after a five-week jury trial in April 2004, for their roles in the earlier scam for the Internet directories, Yellow Business Pages.com and Yellow Business Directory.com. Sentencing in this matter is scheduled for July 2004.

"These invoices duped companies into believing they were customers of a service they never purchased," said Raymond Pierce, Deputy Commissioner, Competition Bureau. "The investigations and sentences in these matters show that the Bureau will vigorously pursue perpetrators of deceptive mail scams that target consumers and businesses in Canada."

The Bureau appreciates the assistance it received during the investigation from Canada Post and the Toronto and Peel Regional Police services.

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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Maureen McGrath
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