Article about Intercable Verlag in the Czech Republic, Translated from Hospodarsky Noviny 16th FEb 2006

The Online Article (in Czech) can be found Here (note Article continues on inside pages)

13/02/06 Possibly hundreds of businessmen fell victim to a free offer to have their address in a trade catalogue. Alexandra Klausmannova, Milan Mostyn. Prague 13.2.2006

Czech businessmen who became victims of a widespread and possibly indecent practice of the Swiss company Intercable Verlag AG have decided to stand up to them and have filed a criminal complaint with Czech police for deceit. This is the latest news of the case in which hundreds of domestic firms came to believe their addresses will be placed in an internet catalogue free of charge and many of them lost money as a result, in total tens of millions of crowns.

Intercable Verlag AG has been using this trick all over Europe for many years. In some countries, for example Germany, the order forms were declared legally invalid. Czech firms received an offer with an offer to be included in a trade list and this form looked like an offer for free services but in the small print it stated that on being signed by the firm's representative, they became liable to pay between 690 and 1290 euro yearly for period between 3 - 5 years.

Those who don't pay find themselves under great pressure and fall into a legal merry go round. "They were bombarding me with invoices every 14 days then raising the amount through interest" says Pavel Melek, the owner of Adoco one of the victim firms. Some of the cases have been judged in Czech courts but each time the catalogue firm came out winning and domestic firms were unwillingly forced to pay. In Usti nad Labem 'Selectra' lost a case this way. Yes we are in dispute with a few firms in CZ admits Czech lawyer repenting Intercable, Patrik Tauer.

He declined to give more information but importantly the difference between Czech and German courts is they never question the legality of businesses like Intercable's. Now victims are starting to fight back. In January Prague company, IMG reported the matter to the police and prosecutor in Prague 4 and other firms are prepared to join them. "We want to fight together with other victims and state institutions should help us" says co-owner of IMG Josef Benes.

According to him the number of victims has reached about 1000. That's the amount of Czech firms registered in the Internet website of Intercable Verlag. "We started calling people according to this list. Everyone we randomly asked were victims and all wanted to join us" says Benes. A great number of victims contacted Ivana Piskova of EASA ALLIANCE (which monitors the practices of advertising companies) who states that victims are not only private firms but also the academy of science or school canteens.

On the Czech market there are other so called catalogue firms like Intercable, for example ECG or Construct Data Verlag and all use the same methods. The Swiss ministry of trade started an investigation last year. They advise Czech victims to use Swiss law according to which it is possible to cancel the agreement using certain conditions in writing within a year of signing. Intercable is part of the conglomerate of businessman Meinolf Lüdenbach who according to media sources earned 55 million euro from this trick during the last 15 years. They operate throughout all Europe and act like the tentacles of an octopus but their brain is in Switzerland. Maiwolf Holdings is based in St Gallen and Maiwolf Managementis situated in Zug. Both companies are surrounded by daughter companies; European City Guide, Construct Data Verlag, Novachannel and Intercable Verlag. Behind all of them is the same person, German Meinolf Ludenbach who lives in Spain.

According to Swiss press, Lüdenbach has earned 55 million euro in 15 years and it was enough to come up with a simple trick which offers firms registration in a European catalogue. The forms pretend everything is free of charge. By signing the form an agreement a contract for advertising becomes valid and costs a lot of money usually for a few years

According to the journalist of Swiss based newspaper Tagesanzeiger, Christian Bütikofer, Ludenbach founded his first catalogue firm in Switzerland in the eighties. First of all he offered registration for just Swiss firms but it was only a matter of time before he went international and created an all European catalogue.. To this end a list of interconnected companies are involved. Lüdenbach's firms divided the European market between themselves says Michael Pluempe, German documentarist who is has been exposing trick guide book practices for a few years.

Novachannel operated in Western and Northern Europe, Construct Data and Intercable concentrate on Central and Eastern Europe and the countries of the former Soviet Union says Pluempe. Ludenbach's catalogue system is carefully thought through and difficult to attack on a legal basis. Psychological pressure plays it s roll. Those who don't want to pay are flooded with reminders and letters from debt collecting companies like Ovag International or Premium Recovery AG. These debt collecting agencies are part of the Lüdenbach Empire.

Who once falls into the catalogue wheels will hardly ever get out. The pressure from debt collecting firms and lawyers is so great that victims often decide to pay or agree with an out of court settlement. Mostly the outcome is that victims pay only 1 or 2 years but not the 3 or 5 as stated in the agreement. Naturally Ludenbach gets his profit.

If anybody decides to fight actively against him, his lawyers take hard steps against those who try to expose the circumstances or those who advise victims how to protect themselves. In England, Lüdenbach's lawyer pressurized the provider of website who monitor the practices of European City Guide until the web pages were removed from the web. Pluempe has also had bad experiences with Lüdenbach's associates. "They started a smear campaign against me, they publicly called me a pedophile and dog shagger" says Pluempe who owns web pages Under pressure he recently moved his pages to Russia.

Englishman Robert Peppett who has a business in CZ has his own problems with Intercable . After calling the management of Intercable criminals, Intercable is threatening him with criminal investigation for slander. But Peppett is calm and not prepared to be frightened.

During his trial .the founder of Intercable, Max Peterhans, was accused of money laundering for the Russian mafia and in the year 2000 was jailed by a Swiss court for multiple charges of fraud.

Anna Hradicka remembers the visit of a well dressed man in tie and suit very well. "He insisted our firm be a long term partner of his publishing company and he came just to confirm the data for the new edition of the catalogue" says the receptionist of IMG s.r.o.

She signed an order for free publishing putting the details of IMG in the electronic address book. The representative of Intercable Verlag took the order form and signed it as well. Then he made a little note remembers Hradicka. He returned one copy to me then left. At that moment the receptionist didn't notice that at the bottom of the form there was a tick in a small window for a paid insert in a directory and CD-rom which would cost 1290 euro yearly [more than czk 30000] without the possibility to cancel for a further 4 years.

Together it was 5160 euro which is more than czk122000.When the owners of IMG received a written request to pay, they were horrified. The order was deceivingly ticked and filled in later by hand says the owner of the victim firm, Josef Benes. He's not prepared to give in to such practices. In January he filed a criminal complaint with the Prague prosecutor's office and is trying to get together with other victims. One of them is Czech furniture company boss, Englishman Robert Peppett. “Everything started so innocently. I received the offer for Intercable services, on top of it in bold letters it stated free listing" says the small grey haired businessman, "the offer looked prestigious and reliable and everything seemed normal".

After a while we received demands for payment, which I didn't accept and I wrote them back saying we did not accept there is a contract between us. Then the pressure started to increase. I received an email, personally from the boss of Intercable, Adrian Wittmer and written threats of court says Peppett. The dispute got to the county court in Usti nad Orlici which issued a payment order for 690 euro yearly. I stood up to it when we discovered the court didn't receive the second side of the so called contract which contains its terms and conditions. "Through this omission the court was practically manipulated by the Czech lawyer of Intercable Patrik Tauer" says Peppett, who is determined to continue fighting against the practices of this firm

He and other victims think Intercable uses deceptive methods, for example a tiny circled area becomes an agreement to pay. On other occasions because the contracts are in English, representatives of Czech firms don't manage to discover the matter of hidden payments. Especially when they were assured the services are free by the representative of Intercable following which, letters requesting payments start to arrive. Some firms give in and pay up and those who don't receive endless written payment demands then threats of court action. Many firms capitulate, some negotiate a lower payment. Not all give up and instruct lawyers against the catalogue scam. That's usually when Intercable start to offer compromises and usually win. Unfortunately, though this trick has never managed to win in foreign courts, the inexperienced judiciary in Czech Republic always rules of favour of the crooked companies.

The first person jailed for catalogue scams was Austrian Florian Sailer. Last year in July the son of an Olympic gold medal in skiing was given a 9 months suspended jail sentence plus a fine of 35000 euro. During the operation which was based in Slovakia, Sailer offered more than 250000 firms the possibility of free advertising in an internet catalogue. The price of 1200 euro yearly was hidden in the small print. This earned Sailer about 5 million euro.

European City Guide was sending seemingly free advertising offers all over Europe and Czech Republic since 1998 but the hidden price was 817 euro. A Catalan court tried to stop ECG by legal means in 2003 at which time the catalogue was based in Barcelona. After the Catalan government received 3500 complaints from 40 countries, they banned it from trading for a year and imposed a fine of 300000 euro. After the court decision ECG moved to Valencia and still continues to operate from there.

Construct Data Verlag operates from Austria and offers publishing in so called Fair Guide which they introduced as the biggest catalogue of exhibitions and trade fares in the world. Two years ago the German county court in Chemnitz judged this firm is cheating and therefore can't request payment from a customer who signed the form. Construct Data, ECG and Intercable Verlag are all part of the conglomerate of Meinolf Lüdenbach

Copyright, Hospodarsky Novinyr 2006

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