Six alleged ad scammers in court
Thu, 25 Oct 2012 9:51a.m.
By Dan Satherley
Six people have been arrested and will appear in court today in relation to an alleged invoice scam operation uncovered by TV3's Campbell Live.
The joint force operation was led by the Serious Fraud Office with support from the police, Organised and Financial Crime Agency of New Zealand, the Commerce Commission, New Zealand Customs and Inland Revenue.
Arrests were made yesterday in Auckland, Picton and Port Waikato. More than 60 staff were involved in tracking down the alleged fraudsters. Search warrants were activated in more than 25 locations.
The five-month investigation, called Operation Edit, began after Campbell Live alleged the scammers were billing small businesses for advertising in magazines that didn't actually exist, or the number of magazines that were printed and circulated was grossly exaggerated.
"The magazines were generally titled in a way that suggests worthwhile causes in subjects such as road safety, parenting or drug addiction," the SFO said in a release this morning.
"It is alleged that the scam has generated up to $1.6 million since 2008."
Five of those arrested have been charged with multiple fraud offences and participating in an organised criminal group. The sixth has been charged with participating in an organised criminal group only.
"Invoicing scams cost New Zealand businesses hundreds of thousands of dollars a year and small businesses and charities are often the target," says acting SFO chief Simon McArley.
"While the dollar amount of alleged offending is not huge, taking action in relation to high volume/low value fraud is important. Overall there can be a significant impact on the economy."
The investigation involved covert investigation, detailed analysis of banking records and numerous victim interviews, says the SFO, which is leading the prosecutions.
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