A DOUBLE loophole in trading laws is enabling bogus charities to trick companies into thinking they are making donations for a worthy cause.

The claim comes from Lancashire County Council's chief trading officer who believes unscrupulous entrepreneurs are cashing in on the double whammy.

Jim Potts says the laws governing the running of charities are in dire need of change before the situation gets out of hand and effects bona fide charities.

He said: "There are more and more examples of charitable-sounding organisations taking companies for a ride. They contact the company with the false notion that they represent a worthy cause with some dummy scheme, for example a promotional wall chart. But of the money these companies collect, little or none goes to charity. There is very little we can do about it."

And the Unsolicited Goods and Services Act 1971 does not cover goods produced and marketing by these companies such as calendars, wall charts and bookmarks.

The latest to hit Lancashire is calling itself Sick Children Need Help which is sending out dummy calendars with company advertisements around the edge.

The victim company receives a copy of the calendar with an invoice for £95 plus VAT. When someone refuses to pay, they use their own debt collection company who send official-looking documents demanding payment.

Mr Potts added: "I would urge any company to check all invoices carefully and only make donations to recognised charities. Do not make payments on demand and report them to the Trading Standards for further information."

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