I write this in total despair – and with the knowledge of the potential consequences.
Last week, after my podcast interview with you, there were a number of issues raised by your customers. Your answer on Thursday was this:
“Again to reiterate my conversation with Ned, new leadership, new life, new direction Netfleet wants to create positive customer experiences and leave the past in the past”.
Many of us were heartened by this (particularly me) – and prepared to give you a go.
But then came Friday
An alleged incident occurred which highlighted every suspicion that some of your long standing customers have held.
I believe there is effectively insider trading going on at Netfleet. I can’t describe what happened in any other way. Certain people have access to private bids on your platform, and are using this information to try and elicit higher bids from others. In my opinion, this is causing (and has caused) financial loss / loss of opportunity to your existing client base.
I am not suggesting or implying that you were aware of; or complicit in this – but I urge you to investigate this allegation – and if you find it to be a valid complaint, take action to stamp it out immediately.
To Summarise What Happened On Friday
Someone working for Netfleet contacted an enduser over a particular domain. This enduser is a businessman, and had never dealt with Netfleet. The Netfleet rep allegedly said “that they had a bid from a big domain investor at $720 (and named the person); and assured him that if he was to bid $750, he would get the domain”.
This businessman thought he was being scammed, because he had already been approached about the domain by someone else. Unbeknown to Netfleet, another regular bidder on the drops had contacted this person first, and offered to try and acquire the domain for them at a lower price (that’s their legitimate business model).
So the businessman rang the number back of the Netfleet rep and he reluctantly confirmed the offer (his reluctance was due to him not being sure if everything was above board). He did not have an account with Netfleet – nor did he sign up for one. He received an emailed invoice for the domain at about 2.10pm. However, they charged him a buyer’s premium and GST on top, so the $750 actually became $874.95. This really annoyed him because he was not told about the additional charges.
And because of that, that’s how I became aware of the story. When Netfleet contacted the businessman, he obviously reported back to the person who had approached him first. Given that the domaining community is fairly small, and a lot of us talk to each other, this person felt obliged to tell the “big domain investor who had bid $720”.
They then told me – and I contacted “the businessman” to hear it “from the horse’s mouth”. He confirmed all of the above in writing.
Gobsmacked Is The Only Way To Describe This.
Your platform is supposed to be a “Fixed Blind Bid” system where your customers can bid in total confidence in the knowledge that no other bidder will know what they have bid.
This from your marketing emails with one hour to go:
Given this incident, and that it probably isn’t an isolated example, let’s look at some of the issues potentially in play:
- Insider trading
- Misleading and deceptive conduct
- Breach of your customers privacy in relation to bids that they have made
- Potential and quantifiable loss to your regular domain bidders
- Continuing lack of transparency in the bidding process will leave lingering doubt
- Integrity of the .au space has possibly been brought into question (just ask the businessman above!)
These Are Some Questions For You
Regardless of ASIC records, in my opinion effective control of Netfleet’s operations (NetAlliance Pty Ltd) has always been directed by David Lye – and put into practise by his brother Mark. I believe this situation continued even after Melbourne IT Group (a publicly listed company) has taken a 50% stake in the business.
- How many telemarketers do you employ?
- Who trained them – and continues to train them?
- What information do they have access to?
- You say that Publishing Australia (P.A) has no access to the “back end” or other data – yet are you aware that Mark Lye (as a Director of NetAlliance) holds a 1/3 share in P.A?
- Given all this, do you now see how a “fair minded person” could easily maintain that there is a conflict of interest between the Lye Brothers / Publishing Australia and the clients of Netfleet?
- Does Melbourne IT (as a publicly listed company on the ASX) condone this incident?
- Will they / you put in place some corporate governance to stop this happening again?
Jonathan, I have put myself in the firing line here on behalf of many of your customers.
Please do a “Volkswagen” and acknowledge responsibility for what has transpired – and promise to fix the problems. Get back to a transparent bidding system.
I know that some peoples natural inclination will be to be to try and “spin their way out of this”. Like throwing the telemarketer “under the bus” for a start. And by probably trying to attack and discredit me (playing the man rather than the ball).
Over to you Jonathan.