The business, "Isla & James", which purports to be based in Bondi, Sydney, is allegedly capitalising on the recent Bondi Beach terrorist attack by claiming its co-founder was a victim of the shooting.
The website, which appeared online nine days after the 14 December event, advertises closing-down sales citing the Bondi shooting as the reason for its closure.
According to Nine Media, government authorities are investigating the legitimacy of the business and warning consumers about potential scams.
While the news report outlines that ‘ghost store’ purport to be selling clothing, bathers and bags, it is the latest in a string operations which include scam jewellery businesses that do not exist.
Jeweller recently published the first instalment of an investigation into fraudulent and sham online retailers posing as local jewellery stores and subsequently published the details of one jeweller who decided to fight back, settling the score with one fraudster.
Described as ‘ghost stores’ by many - the more appropriate term is Scam Store - these fraudsters often claim to operate jewellery retail locations that do not physically exist, undermining genuine, hard-working Australian retailers and leaving customers disenchanted and out of pocket.
Online scammers are a familiar nightmare for consumers because when shopping online consumers often run the risk of purchasing knockoff products sold by a business that doesn’t play by the rules.
For legitimate jewellery store owners, the damage runs deeper.
Beyond the tarnish these fly-by-night ‘ghost store’ operations leave on consumer trust in the jewellery industry, some scammers are willing to take things further, including stealing product photos and descriptions and promotional social media content.
For Olivia Deskoski, the owner of Black Star Opal, enough was enough and she had an interesting story to tell.
Black Star Opal is a family-owned business that has been involved in the Australian opal industry since 1969. Today, it operates a retail store, The Opal Centre, in Coffs Harbour, New South Wales and found itself as part of a scam operation.
“I received an email from a gentleman in the US saying ‘I think you should know that there’s a website that has stolen all of your product images and is scamming people’,” Deskoski told Jeweller.
“It was a surreal experience, seeing hundreds of our photos and product names on someone else’s website. I had never heard of anything like this before.
“The products were mislabelled, for example, gold-plated products were listed as solid gold products, and the prices were ridiculously low, in addition to multiple buy discounts. The home page imagery looked like an underground coal mining operation - not opal mining - and there were fake customer reviews as well as fake ‘featured in’ media publication claims. I absolutely panicked.”
Deskoski undertook an ‘under cover’ campaign, using social media to distribute warnings on Facebook and Instagram, encouraging consumers to avoid these specific websites and to perform more research.
Her message: If it looks too good to be true, it probably is.
Bondi store’s dubious claims
The "Isla & James" website asserts that its co-founder, James, was shot during the antisemitic attack, leading to the store's imminent closure.
Nine Media asserts that the claim is dubious, as none of the 15 people killed in the terror attack were named James, and the site lacks essential details such as a specific street address or an Australian Business Number (ABN).
The website suggests products ship from a central warehouse in Asia and invites potential customers to request business registration and VAT details, raising further suspicions.
Images used on the site appear to be AI-generated, and Google Lens imagery links the products to other e-commerce sites with near-identical layouts as well as online marketplace Temu.
NSW Fair Trading is attempting to have the site taken down and is cautioning the public against deceptive practices that exploit community sympathies.
Government condemnation and warnings
Acting Fair Trading Minister Jihad Dib has condemned any attempts to manipulate and/or deceive consumers after this Bondi tragedy, saying that Fair Trading intends to issue a public warning about the site.
He said the government is committed to protecting consumers from misleading conduct.
"The events at Bondi were senseless and despicable," Dib said.
"Exploiting the grief and suffering of our community to turn a profit is abhorrent – especially at a time when so many small businesses in the area have been doing it tough”.
The consumer body warned the public to be on the lookout for “ghost stores”, illegitimate fundraisers and other deceptive conduct in the sale of goods or services linked to the Bondi attack. Cases can be reported to Scamwatch.
Nobody know you are a dog?
Jeweller’s investigation into what appears to be a widespread and elaborate worldwide scam, retail websites are being established to mimic or falsely claim to be Australian high-street jewellery stores.
The July report titled, On the Internet, nobody knows you’re a dog, included examples of extraordinary measures being taken by scammers to build the illusion of authenticity.
These include creating AI images of stores and business owners that don’t exist, as well as fake delivery tracking numbers and financial statements.
The report established that this is merely the tip of the iceberg.
Many of these shady online retailers use fake reviews, fictitious personal backgrounds, and fraudulent sales events to deceive consumers into purchasing products under the guise of supporting a local business.
Jeweller has been monitoring many of these international fraudsters for some time. The Australian Competition and Consumer Commission (ACCC) recently issued a public warning regarding the conduct of these online retailers, highlighting four specific examples.
The consumer watchdog noted an increase in reports about ‘ghost stores’, with an estimated 360 complaints concerning around 60 online retailers recorded over the past six months.
While this latest scam does not directly involve jewellery, the incident serves as a reminder for jewellers to remain vigilant against fraudulent activities and maintain ethical business practices.
Jewellery retailers can learn from this situation by ensuring transparency in their operations, providing clear contact information and avoiding any marketing tactics that could be perceived as exploitative.
Consumers and the trade are urged to exercise caution and report any suspicious activity to Scamwatch.
More reading
Consumer watchdog issues new warning about ghost stores
Ghost store scammers severely impacting jewellery retailers
Scorched Earth: Jewellery retailer settles score with scammer
Consumers vent frustration regarding online retail scammers
Don’t be scared of ghosts: Jewellers must stay online!
Don’t hold your breath, no one is coming to save us
On the Internet, nobody knows you’re a dog
Consumer watchdog issues warning regarding online retail scammers