Scammer says court defeat temporary setback

By ADAM GIFFORD

Perth-based domain name scammer Chesley Rafferty says an Australian Federal Court judgment against him was a "temporary setback".

Judge Ray Finkelstein ruled in favour of .au domain names administrator auDA and the Australian Competition and Consumer Commission that four mailouts totalling more than 750,000 letters sent by Rafferty's company Domain Names Australia were misleading and deceptive.

The letters sent to holders of .com.au names offered to register or renew a similar name in other domains like .com or .Net.au.

Similar letters were sent to holders of .co.nz names by another Rafferty company, Domain Names NZ, but most of the responses were intercepted by the Commerce Commission.

Judge Finkelstein said most people were likely to interpret the letters as being notices from their legitimate provider to renew existing domain names. However, he ruled the letters were not invoices.

He declared Rafferty and Domain Names Australia had breached the Trade Practices Act and granted auDA and the ACCC injunctions preventing Rafferty from further breaches for three years.

Chris Disspain, auDA chief executive, said it would take further action against Domain Names Australia and Rafferty to get refunds for people taken in by the scam.

Commerce Commission fair trading manager Deborah Battell said the Australian court's decision vindicated the action taken by the commission.

"It was not practical for us to take court action against a company which is not located here, but we were able to use powers we had to get a search warrant and take action," she said.

"We do not expect the company to attempt to sell its services into New Zealand again."

She said Rafferty's failure to challenge the commission's actions, even though he was being denied more than $500,000 in revenue, could be an indication of how strong he thought his case might be.

Rafferty said he was appealing against the judgments.

"This is a temporary setback. It is a positive outcome because a lot of the findings that auDA and ACCC were hoping to get against us, the judge dismissed," Rafferty said.

"One major one was the fact the letters of advice sent to businesses were not invoices."

He said he would use the court's guidelines for future mail-outs.

"We never intended to work outside the law. We operate in a fast-moving industry, and we have taken legal advice on ways to tailor our notices.

"We will correct the error and move forward." Rafferty said he was seeking legal advice on ways to resume activities in New Zealand, although the Commerce Commission had put him off his stride.