Not all businesses are genuine
Not all businesses or traders are real or trustworthy. Don’t assume that all businesses or traders you may come in contact with are examined and approved by governments.
Business cards, registration numbers and other forms of identification don’t necessarily prove that a business is legitimate, and even businesses that are legitimate may act dishonestly anyway. And some may pretend to have authorisations, accreditation or licences that they don’t have. Scammers can also fake things like registration numbers and other identification.
If you have doubts, there are some tools that can help you check.
Check business information
It’s always safer to check a business using the information you have and online tools. While having the right registrations and licences doesn’t guarantee that a business is trustworthy or real, it’s a good start.
In Australia, business names must be registered with the Australian Securities and Investments Commission (ASIC) and many will have an Australian Company Number (ACN). Individuals doing business using their personal name don’t have to have a registered business name, but will usually have an Australian Business Number (ABN).
You can usually find an ABN or ACN on the business’s website, in its terms and conditions, on a business card or on an invoice.
Check if a business is registered on the:
Extra permits or licences
In many fields, individuals and businesses need extra licences, permits or registrations to operate legally. For example:
- builders must be licenced or registered in their state or territory
- financial services providers, such as mortgage brokers and financial advisers, must have a Financial Services Licence.
Check if a business has a valid licence or permit
To check if a business has a valid licence, registration or permit, contact the relevant registration or licensing authority.
Check business.gov.au for a list of business licences and permits that apply. The department that oversees fair trading laws in your state or territory can provide information on business licenses and registrations.
Some individuals and businesses are members of professional, industry or trade associations. This is usually voluntary.
If the individual or business claims to have any memberships, you can contact the relevant association to check the claim is true.
Reading online reviews from other consumers can also help you decide whether a business is real and the quality of its services. Don’t just look at reviews on the business’s own website, or social media. Also look for reviews about the business on review platforms and other online forums. Check reviews from multiple sources.
Be wary of fake reviews. There are some signs that can indicate a review is fake:
- a spike in highly positive or negative reviews over a short period of time
- multiple reviews written from the same email or IP address
- similar reviewers’ names
- generic reviews without specific detail about the business or product
- reviews written in similar language as other reviews for the same business or product.
See online product and service reviews for further guidance to consumers using online reviews.
Check the address of the business using an online map to see if it really is located in the place it says it is.
Look carefully at the domain (website address) to see if it really is the business you are looking for. Scammers can set up fake websites with similar website addresses to the real business they are pretending to be, so take your time to review the information.
Avoid businesses that ask you for personal information before you can see information on the website.
Check the payment methods. Do they ask for payment by unusual methods for that industry? Check that for any payments, their website address starts with https: (instead of http:) and look for a padlock symbol.
Find trustworthy businesses
Often, the best way to find a trustworthy business is to get a referral from a person you trust.
Don’t take advice from people you have only met on social media. Many industry bodies and associations can also refer you to their members, which may also be listed on the association’s website.
You can also do your own research by searching the company name online.
Remember, that if it is too good to be true, then it probably is.