Risky business: Five safeguards against cyber fraud

Foul play is around every corner when operating online. Business that know how to safeguard against the shysters are the ones that thrive.

The internet is a scary place. Cyber fraud comes in plenty of shapes and sizes and all are devastating to a business. Even top international companies get taken advantage of online, but what you can do is learn to protect your business. There are some safeguards you can take to prevent these dangers but unfortunately online trading will always be a somewhat risky business.  

Many brands have identified the online marketplace as the key growth area for time conscious customers. Online companies such as Amazon, Topshop and ASOS have made their fortunes from online sales to both local and overseas customers. But doing business online has a dark side and if you are not vigilant then your business could fall victim to online counterfeiters and unauthorised resellers that take advantage of unaware customers.

The internet uses a variety of tools and algorithms to connect consumers with fast, relevant information and this often comes at the expense of security. One such tool, used by Google, is ‘AdWords’. These are paid advertisements that appear at the top of each page of your Google search. They are algorithm-based and anybody may purchase them. Counterfeiters can purchase AdWords that link to a website, which ‘piggybacks’ on well known brands and diverts customers away from your business to buy counterfeit or lower quality products. Google has a strict policy on counterfeiters and will remove offending sites and AdWords. But it requires brands to be vigilant about following online activities and to have the proper legal protections in place.

Care should be taken to ensure that you actively monitor and maintain your domain name registrations. ‘Cybersquatters’ are (usually) companies that wait for domain names to expire and then register them in their own name, usually within hours of expiration. This is done with the intent of posing as being associated with your business and diverting your customers to their site. They also bank on you offering to buy back your domain name from them at an inflated price.

Gucci is one of the brands that benefitted from being alert and having the proper legal safeguards in place. On October 17, 2013 Gucci was awarded $144.2 million in damages from 155 online sellers for counterfeiting and cybersquatting. The online sellers copied parts of the Gucci campaign including trademarks, advertisements, product images, and descriptions and sold counterfeit Gucci branded goods online or linked to counterfeit websites. Many of those online sellers used variations of the Gucci domain name and internet sites were registered in Britain, Canada, United States, France, Italy and Japan.

This case serves as a reminder to all businesses to implement and monitor brand security practises and to determine whether your brand is sufficiently protected.

Here are 5 key tips to protect your brand online:

1. Trademark your business name, logo and key catchphrases. Remember to trademark in every country that you do business. In order to request Google to take down an offending site or AdWord, Google requires evidence that you are in fact the brand owner. Having a registered trademark is the easiest way to prove your legal rights to your brand.

2. Register all relevant domain names and variations of those domain names in relation to your brand and business and ensure registrations are maintained and renewed before they expire. Simply buying the .com version and leaving the .com.au version or .net version is unwise. Also, secure the country variations in which you do business (i.e. .com.it for Italy, .com.fr for France and so on).

3. Regularly Google and Yahoo search for your brand and monitor the results.

4. Subscribe to Google alerts for your brand and domain name. Google Alerts are part of a free service that is offered by Google and will notify you when someone writes about you on the internet or is linking to your website.

5. Take Action. Google has a myriad of policies which deal with counterfeiting and cybersquatting and navigating those policies is often quite difficult. Engage a solicitor with the appropriate experience to help you establish and implement your domain name and intellectual property management plan. Seek advice as soon as you become aware of a brand management or defamation issue.  A well drafted letter to Google can be effective in having offending material or misrepresentations removed and can spare you from engaging in costly litigation to protect your brand.

Fotini Kypraios is an Accredited FBA Adviser and a senior associate at Meerkin & Apel Lawyers.