Exclusive: London company accused of PS2 fraud

Docklands firm under police investigation for taking fake PlayStation2 orders

London's Metropolitan Police is investigating a Docklands company that has allegedly defrauded customers out of thousands of pounds in fake PlayStation2 orders.

Games Master advertised in publications such as classifieds paper Loot last month, offering PS2 consoles before Christmas. Sony launched the hotly-anticipated console 24 November, but supplies have been short and consoles were only available to those who pre-ordered in the autumn.

Customers who called Games Master's Docklands telephone number were told the company had access to stocks of the console which would be received directly from Sony. Payments were accepted by cheque, but the consoles never arrived despite the cheques being cashed, and as of Friday the telephone numbers of both Games Master and Peter Lawrence, apparently the company's sole representative, had been switched off.

"I can confirm we have had a report on the company, but it is too early to say anything else," a spokesman for the London police force said.

The Trading Standards body for the Docklands area said it has received a number of complaints against Games Master. "We are liaising with the police on this matter," said a spokesman for the London borough of Tower Hamlets.

Derek Stracey, one of those who ordered from Games Master, said he has lost the £1,200 he spent buying four PlayStation2s for his family and on behalf of his relatives. "It's a lot of money to lose before Christmas," Stracey said. He is instructing his lawyers to take action against Lawrence, if he can be tracked down.

Initially, Lawrence said he had pre-ordered several extra machines from Sony and was reselling them, according to Stracey. "I awaited the arrival of my machines, which initially [Lawrence] promised on the 25th, the day after launch. Nothing arrived that day. He said there was a delay and my machines would be with me on Tuesday," Stracey said. "He said the delay was due to Sony distribution problems."

The calls went on until Thursday, when Stracey could no longer reach Lawrence or Games Master by telephone. "He is gone with [my] £1,200, and I would imagine a lot of other people's PS2 money," Stracey said. "On top of that, a lot of disappointed faces will be seen on Christmas Day."

The anticipation surrounding Sony's new console, coupled with the lack of availability, have led many to take chances in hopes of securing a machine in time to have it under the tree. For example, the Canada Better Business Bureau on Friday confirmed that a Web site called PS2storeUSA.com has been taking fraudulent PS2 orders via credit card. The professional-looking site, which has not been updated since 20 November, is headlined "Get your PlayStation2 in time for Christmas."

Some of those who were able to get their hands on PS2s have taken advantage of the demand to put them up for auction -- often unopened -- on auction sites such as eBay. The consoles have fetched huge premiums, with prices surpassing $1,500 (about £1,000), more than three times their retail value.

If customers are defrauded by credit card, they can usually be compensated. Cheques, however, do not have the same protections.

Tower Hamlets' Consumer Advice line can be reached at 0207 3646767.

See Gamespot UK's PlayStation2 channel for full coverage.

See techTrader for the latest technology investment news, plus quotes and research.

Have your say instantly, and see what others have said. Click on the TalkBack button and go to the ZDNet News forum.

Let the editors know what you think in the Mailroom. And read other letters.