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UK businesses are being warned to be on their guard against a Spanish firm compiling information for a CD-ROM directory.

The Federation of Small Businesses (FSB) issued a statement today warning companies to be vigilant after receiving a tip-off that UK firms have been sent forms enquiring whether they want to be included in the business directory.

On first reading, it appears that signing up for the CD-ROM is free but, buried in the small print is news that anyone signing up to the directory is agreeing to be inserted in the next three editions of the guide at a cost of €917 - or about £611 - for each version.

According to the FSB, the company behind the CD-ROM - European City Guide (ECG) - was successfully shut down last year and fined more than £200,000 for a similar scam. Now, though, the ECG has relocated to Valencia and is operating again. The FSB claims it has received proof that ECG is once more targeting small businesses with misleading mail shots.

Said FSB International Affairs chairman, Tina Sommer: "The ever increasing paper chase and a lack of dedicated administrative departments mean small employers have little time to go through all their mail with a fine tooth comb. Unfortunately, this makes them targets for companies like ECG.

"The FSB advises small businesses to make sure they always read the small print before they sign anything. If they are ever in any doubt they should contact the local trading standards office."

Earlier this year businesses were warned to be eagle-eyed over the summer months since many rogue traders take advantage of senior staff taking leave in the summer to trick more junior employees into paying what looks like an urgent invoice. In many cases, by paying these invoices, the company actually signs up to a contract which forces it to continue paying for years. ®

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