Domain Corp fined $1.95m for legal breach

Domain Corp and affiliate Domain Name Agency have been fined a combined $1.95 million for breaching Australian consumer law during a court case initiated by the ACCC.

The court found that the two domain companies sent out around 300,000 unsolicited notices to businesses that were disguised as renewal notices for existing domains, but were instead notices for the registration of a new domain name at costs ranging from $249 to $275.

The court found that the companies made false and misleading representations, and that the notices cost Australian businesses and organisations around $2.3 million in unnecessary spending.

Steven Bell, the sole director of both domain companies, was found to have been knowingly involved in the conduct. He has been disqualified from managing a corporation for five years and ordered to pay the ACCC’s costs fixed at $8000.

In addition, the court has issued injunctions against the company for two years and Bell for five years that include requirement that any initial notices sent out must prominently display text making it clear that the notice is not a bill and that recipients are not required to pay any money.

“The Domain Companies misled businesses into thinking they were renewing payment for the business’s existing domain name, when in fact the business was paying for a new domain name,” ACCC Acting Chair Delia Rickard said.

“These sham operations target small businesses, capitalising on a lack of understanding of the domain name system or a busy office environment. We encourage businesses to be vigilant when paying invoices, especially if it is for a domain name registration service.”

Image credit: ©stock.adobe.com/au/tashatuvango

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