More than 100 telemarketing companies blacklisted for debiting consumers illegally

A worrying statistic for South African consumers:

The Payments Association of SA (PASA) announced that there are more than 100 telemarketing companies who have been blacklisted for debiting consumers for services for which they either did not provide or for which consumers did not sign up for.

According to PASA CEO Walter Volker, many of these companies are guilty of fraudulent transactions where banking details of individuals are obtained illegally.

PASA claims that efforts are under way to “weed out the rotten apples” in the industry. A shocking 120 000+ of the 31 million payment orders processed monthly had been disputed by consumers.

Volker said once a telemarketing company had been blacklisted by them, the names, identity (ID) numbers and physical addresses of the owners and directors of the companies were listed.

“By keeping track of address details as well as ID numbers, it makes it easier to spot when they reappear under a different guise.”

He advised banks to educate the public to check and verify whether any of the deductions made on their accounts were fraudulent or made without their consent.

As a billing management service providing clients with a platform to do payment collections, we are very weary of fraudulent activity.

We have put many safety measures in place to prevent fraud from occurring. We also have to put a lot of faith and trust into the payment gateways that we integrate with. Therefore, before integrating we first assess their systems and whether they perform thorough vetting before awarding their client a facility.

“At Direct Debit, when any SnapBill consumer approaches us for a debit order facility, we first do extensive credit checks, we assess their dispute ratio and we do not accept any businesses who have been blacklisted or have any criminal history of fraud.” says Schuzelle Smit, Managing Director at Direct Debit.

“We have had cases where fraudsters have approached us, but we eliminated them immediately.”

Furthermore, Direct Debit has these requirements in place to combat telemarketing fraud:

  • The call centre has to be registered with the Direct Marketing Association of South Africa (DMA)
  • The call centre has to be a registered company and has to adhere to FICA requirements such as:
    1. Copies of owners ID’s
    2. Proof of residence
    3. Proof of trading address
  • The call centre needs to provide their complaints and cancellation policy
  • List all products being sold, if there are other products a list of all SLA’s need to be provided
  • A business profile needs to be provided including CV’s of owners
  • The call centre needs to verify if they are using voice recorded mandates, if so, they need to provide a copy an actual voice mandate
  • Provide proof of retention of voice mandates for at least 7 years
  • ITC checks on both company and directors
  • HelloPeter checks
  • Google checks on the company and the directors
  • Site visit at registered office
  • Check all documentation for legality

All other service providers:

  • Company needs to be registered
  • FICA requirements:
    1. Copies of ID
    2. Proof of residence
    3. Proof of trading address
  • ITC checks on both the company and it’s directors.

At SnapBill, we also want our users to feel confident that their clients banking details are never at risk.

We have ensured this by encrypting and storing all bank account and credit card details in association with the regulations of the Payment Card Industry Data Security Standard (PCI DSS), ensuring that these details are never at risk of falling into the wrong hands.

When our users invoice a client for the first time, the invoice will always include a link to a standard debit mandate form which can be completed and returned to the service provider.

Additionally we have a system rules which enforce the suspending of a client’s (or users clients) banking details after a transaction has either:

1. Bounced twice consecutively due to insufficient funds
2. A dispute has been initiated by the consumer

PASA’s CEO stated that relatively unsophisticated consumers were at the greatest risk because they did not know how to dispute illegal debit order deductions.

“I urge all consumers who have been defrauded to immediately register a case of fraud against the service provider or contact us and we will direct you” Jaco van Wyk, Founder & Managing Director at SnapBill.