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Another court case over


 Although I do not want to name names, one of our clients, a small newsagent has finally settled with one of their old suppliers their case. The amount of money our client has recovered about a quarter of a million dollars which is not all their loss and they have to bear their costs which will make a substantial dent to the payout figure.  I will not be surprised if it is over half the payout amount.

So I think it is a good example to discuss the dangers of taking on agency sales in modern retail. 

An agency sale is a product for sale that a retailer markets on behalf of another organisation e.g. transport tickets,  bill payments, dry cleaning drop-offs, transport, lotteries, etc. Often the payout is seen partly in the number of customers coming to the shop to get these items. As the margins on these products tend to be low, to get a decent return you need a lot of sales which became the problem here as you will see. Say you make $20,000 at 2% margin you are looking at a million dollars of turnover. 

What happened here is that the supplier gave our client an electronic key once our client had signed the appropriate forms and also gave the supplier their bank account details. 

The problem is that someone else got a copy of my client's electronic key and soon they were trading on this account. As they were selling my client got billed for their trade. This other business did about $100,000 a year of trade in these goods and over time, the amount grew to about a quarter of a million dollars. 

This was only noticed by accident when an item was sold in this other business that my client had never traded. My client then immediately questioned this sale. Soon a stop was put on the account. Then my client requested as it was an error for a full refund of a quarter of a million dollars.

A dispute started.

No-one disputes that these trades were done by someone else.

However, the supplier stated that the only way for this key to have gone to this other business was if our client or people associated with our client had intentionally or otherwise given this electronic key to another business. So my client is at fault. My client does not feel that this happened. Also, my client's lawyers stated that even if this was true, it was the supplier's fault as their security is clearly not good enough as all a person had to do was copy an electronic key. 

Now you would think that it would be in everyone's interest to find out who this other business was? Well not really as it might establish who is at fault and if that other business did not have a quarter of a million dollars, then whoever is left with the blame and so probably the debt they would not be able to be recovered.

However, both sides did agree that my client was at fault for not having proper control over their accounts, something they are legally supposed to do. 

So began a three-year case which went on and on until finally, both sides came to a deal.

Here are some points that I think came out of this legal case

1) You need to audit your agency sales, your point of sale software needs to produce reports detailing your sales which you need to match up to the supplier's figures.

2) You need to ensure adequate security of your computer system. The supplier's argument that someone who knew what they were doing *could* get a copy of the electronic key given access to my client's computer system is valid. 

3) The authorities were not helpful, and the legalities are not straightforward.  Here is suited both parties interest not going to the police.

4) Agency sales even if they do not make much profit can generate a lot of turnover so giving a high risk.


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Lottoland stopped in Germany



In a story that sounds very familiar to an Aussie, the German courts have ruled that Lottoland may not run in Germany and Lottoland may not accept German gamers. Apparently in Germany Lottoland is taking about 7% of the local lottery sales now.

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Burden of proof



A few people asked me today, what principle is there an obligation and responsibility on the person making a claim was to say "that I had 1700 newsagency clients" on the net or anywhere else for that matter, to provide evidence for their claim, e.g. there was an independent audit done by these people, under supervision of these people that .....

This is called the burden of proof,








Australian Lottery and Newsagents' Association (ALNA) took a beating today


I think talking to people today and reading the communication going round that the ALNA took credibility beating today.


The claim being made I believe from Calvin Ayre, but it could be Lottoland that the ALNA is in a severe financial problem (something I doubt) and that its claimed membership of 4,000 is 80% less. All this the ALNA has denied.

This has been picked up by quite a few gaming news sites.

Game intelligence

i-conseils SAS


The daily payoff

Some of these are claiming that the ALNA is lying.

For those that have not followed the dispute on membership, what happened is that Lottoland got financial documents from the Australian Securities and Investments Commission. When these were examined and then analysed by dividing the subscription revenue by the yearly member fee, they stated that ALNA has about 707 paid members., not 4,000 that the ALNA is claiming.

The ALNA replied that it never claimed 4,000 but 2,000 business and then claimed that 4,000 such business exists. From what I can see this looks what the ALNA did say although possibly Lottoland has some or perhaps many words spoken by representatives of the ALNA that do not make this distinction.

I was thinking about this and for someone to make a claim honestly that they have about 2,000 members they need at least 1501 members, and then they can round up. Now the ALNA claims that it has 400 members in an affiliate group who are not specified and the ALNA represents them, so that leaves the ALNA needing 1101 members. The ALNA further claim that many of these members have more than one business and one unspecified has 58 businesses which if we are talking lotto is a sizeable organisation.

Plus the ALNA claims the 707 figure is in error as many of its members do not pay the yearly fee claimed but less so one could say 800 or 900 plus some being multishop businesses it is possible that the 1101 member figure can be reached, thus making the 2,000 claim accurate in a strictly mathematical sense.

Overall I would say that both sides claims here are plausible, but I look forward to hearing more.

Finally that this dispute beside being nasty is unnecessary, I believe this is not a dispute between lottery franchisers and Lottoland but one between TABCORP, Lottoland and the federal government over a billion dollars a year of revenue.

Banking royal commission


It is appalling the news that is being reported from the Banking royal commission here. It appears that the banks have been both contemptible and wrong. It appears that people have been charged for services and advice that they never got, some of these people were actually dead for years. As I know a few of my clients use such financial advice services if so I would suggest checking the bills.

Privacy policy update.




I got a lot of enquiries over this, and although I stress I am not a lawyer, and this is my understanding of the law.

* All organisations in Australia have an obligation to protect peoples privacy but not all the laws refer to all organisations.

* All websites must have a privacy policy. Here is our privacy policy on our website, please fill free to copy and modify it, if you do not have such a privacy statement now. As our system talks directly to Shopify, you can use the Shopify privacy policy generator too.

* The current new laws are based on existing privacy laws and there are many laws about privacy both State and Federal. In my state of Victoria, there are seven laws listed for Victorians in the Wikipedia here plus there are a further eight laws listed that would cover us federally.

I found the Victorian government very useful in this, and they gave me here a free template to create our privacy statement.

They also directed me to this link which had a long explanation which is here which we found very useful in reviewing our pos software.

* What really stunned us when we were briefed about these new laws is that a violation of the privacy laws may occur even if the information is false. For example, say I put in the computer a client's date of birth as 01/01/1990 and this is not true. It may not matter if a data breach occurs as it appears in the data that your birthday is 01/01/1990.

As all states have their own laws, if you have any queries you should address it with your state government authority or your state industry body.





The legal dangers of blogging


I spoke about this before of the legal dangers of blogging. If you need another example well this blogger said it “was a huge free speech, political communication and public interest matter” what he blogged. The courts do not see it like that and now he has been found here guilty of contempt of court and is looking at possible jail time.

If you are going to blog, please be careful.

Credit rating for You and your Customers


Many people before they take on a big customer want to do a credit check before they set in their pos software a credit limit.

Although you can get this credit check free if you like a credit report about yourself (links provided) to see what it looks like you need to pay, to get a credit report about your clients or potential clients.

The four biggest agencies in Australia, in order, I have put links into the free plan here, to test for yourself for your score.

Dun & Bradstreet
Tasmanian Collection Service which is local but very important to people in Tasmania.

If you want a full report


One point I warn you is many complain after filling out for a Veda free credit file, they get a call from Veda asking why you need the information and then the Veda salesman starts explaining why it is important to get a paid report. Just say NO.

As there is no standard for the credit score, what you will find is that these companies produce have their own score based on whatever they decide and they all use different rating systems. As such they sometimes give a very different result for the same person, so you get rejected for one lease, which used Veda and another agency that uses Experian, a different credit agency, accepts you.


As Veda is the most popular system used, I will discuss it. What you get is something that looks like this, Note the old system was up to 1200 so your old score might be very different.


Using the Veda system, everyone gets a credit score between zero to 1200.

Note The national average is 550, so do not be too upset if you get a score about that.

What you decide to do once you get the score of someone is up to you, but I will note, I have not noticed a good relationship between the score and the subsequent debt history being much help.




Company is under scrutiny for making fake customer reviews


A solar company is under investigation currently for posting five-star "reviews" on a website with the ACCC. This is not the first time an organisation has been charged with doing this. There is an interesting discussion on the whirlpool forum about it, which is worth reading if you have a website, or you are thinking of doing this and I suggest you read the ACCC guidelines here.

We had something similar happen to us here. Readers may recall a character Jack and Nelson, who kept writing negative reviews on our posts and discussions. It turned out to be a person in a competitor company of ours.

He got caught because he was stupid, as he accidentally posted under a name that stood out, then he was ignorant as clearly, he did not realise that almost all browsers have a trackable and unique fingerprint and because he was careless and exposed his IP address. One point led to another and another, and he was caught. Once notified and told what a [email protected]!#@ he was for doing this. He stopped immediately, maybe we should have gone to the ACCC too?

At the time, I was I confess hurt and just happy he stopped.


Update: 30/Nov/2015 As a result of this action by the ACCC, we have updated our website by putting in terms of use here. As far as comments people have made in other forums about this jack, please give no credence to their comments.