Home detention for $700k fake invoice scam

By Ben Chapman-Smith

Judge Field said the woman's offending was motivated by "pure greed".
Judge Field said the woman's offending was motivated by "pure greed".

A former company director who fleeced $719,000 out of her victims by sending out false invoices has been sentenced to 10 months home detention.

Sonia Klair appeared at the Auckland District Court yesterday after pleading guilty to 64 charges brought by the Commerce Commission under the Crimes Act.

Those charges were laid following 53 complaints made about Klair, a spokesman for the Commission said.

Between July 2008 and August 2010, Klair ran a business called NZ Look Ltd which engaged in false billing practices, also known as pro-forma invoicing.

The scam involved sending "special offer" documents to people, offering to renew their online business directory listings with NZ Look, even though those people had no previous listing with the business.

Klair would then send invoices, and sometimes debt recovery notices, seeking payment for services people had not agreed to, or had agreed to on the basis of a misrepresentation made to them.

Her scam, which was described by Judge Field as "sophisticated", pulled in more than $719,000 in total.

Field said Klair's offending involved particular planning and preparation and was motivated by "pure greed".

A spokesman for the Commission said the 53 complaints clearly represented only a small percentage of the total number of victims.

It was difficult to know exactly how many people had lost money because some were probably unaware they had and others simply did not complain, the spokesperson said.

Sarah King, who runs a website dedicated to exposing scams in New Zealand, said she had been contacted many times in the past about Klair's false billing practices.

King said the number of people who made complaints was "only the tip of the iceberg".

Many people lost only small amounts of money and so did not bother to come forward, she said.

The Commerce Commission said its case against Klair was the first time it had brought charges under the Crimes Act.

Other prosecutions and penalties previously imposed under the Fair Trading Act had not been strong enough to deter conduct such as Klair's, the regulator said.

Stuart Wallace, the Commission's consumer manager, said businesses should be wary of any unusual invoices.

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