Escudero urges DTI: Boost protection vs. online fraud

With more and more Filipinos choosing to shop online, Sen. Francis “Chiz” Escudero is urging the Department of Trade Industry (DTI) to create a separate office to regulate group buying sites and handle complaints of online fraud.

Escudero said a separate office under the DTI’s Consumer Protection Group could focus on addressing complaints related to online purchases and regulating group buying sites, which have an uncertain legal personality in online transactions.

He said he has received reports that different offices of the DTI were pointing fingers at who would handle complaints from consumers who have been scammed online.

“While it is important to inform shoppers of the risks and trade malpractices happening online, it is not enough to safeguard their rights and welfare as consumers,” said the senator.

“The government must put more teeth in the current consumer protection law and update obsolete provisions to keep up with the changing consumer practices brought about by people’s access to technology,” he further said.

READ: Online shoppers warned against fraud | Selling goods online? Trust is key

Escudero then expressed support for the proposal of the DTI to strengthen Republic Act No. 7394, or the Consumer Act of the Philippines, by increasing the minimum penalty against its violators.

Under the Consumer Act, the minimum administrative fine ranges from P500 to P300,000. The DTI is proposing that the penalty be increased to “not less than P50,000 or five percent of the gross sales of the consumer products and services subject to consumer complaint, whichever is higher.”

The DTI released an advisory in July, saying consumers should observe the “red flags” of an online shopping fraud: products advertised at very low prices compared to other sites; online seller’s poor ratings; money transfer direct to the seller’s bank account instead of preferred payment mode; absence of website’s physical address or contact details; and absence of privacy and terms and conditions of use.

Those who wish to report online scams from sellers registered with the DTI or Securities and Exchange Commission may contact the DTI’s Consumer Welfare Desk at 8118231 (Metro Manila) or 7513330 (outside Metro Manila).

Online fraud cases may be reported to the Anti-Cybercrime Group of the Philippine National Police at 7230401 loc. 5313, the National Bureau of Investigation Cybercrime Division at 5238231 loc. 3455 or the Department of Justice-Office of Cybercrime at 5238481 loc. 222.

Escudero said the government should be more aggressive in safeguarding consumer interest as cases of online scams have increased with the growth of e-commerce in the country, which has 39 million Internet users.

“With everything just a click away, consumer behavior is shifting. More people are now making purchases through the Internet, which makes them more vulnerable to fraud, especially if they are not well-informed,” he said.

“This requires a shift in government regulation as well. Consumer protection should follow consumers where they are, which in this case, is online.”

The senator then cited a study by Visa International, the Visa e-Commerce Consumer Monitor 2014, which showed that 9 out of 10 Filipino consumers use the Internet to shop at least once a month, with convenience (58 percent), price (47 percent) and deals (46 percent) cited as the top reasons for online shopping.

But this, he said, has given rise to online scams as well.

Escudero also pointed out a report of the Fair Trade Enforcement Bureau under the Consumer Protection Group that the number of online scam cases reported in Metro Manila alone increased from 146 last year to 345 as of October this year.

“There are so many more cases of online fraud that remain unreported because, perhaps, people think they have no recourse for this,” he said. CDG

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