Cambridgeshire Police has taken the unprecedented step of issuing a global warning about St Neots-based Dot Com Avenue.
Trading as service provider, the company is believed to have raked in hundreds of thousands of pounds by offering to pre-register .eu domain names for companies.
But many companies contacted are not eligible for the suffix, and .eu domains cannot in any case be pre-registered.
"You can't pre-register .eu names," stated Ken Sorrie, director of Internetters, a registrar accredited by the Internet Corporation for Assigned Names and Numbers (Icann).
"We don't even know who will be appointed as the registrars for .eu or what the qualifications for this role will be."
Companies must have their registered office, central administration or principal place of business within the European Union to be eligible to apply. Individuals registering must be a resident in the EU.
Cambridgeshire Police said in a statement: "We are aware of dealings Dot Com Avenue has had with companies and organisations as far away as the US, countries in which most companies and individuals are not eligible to register for a .eu domain name.
"If anyone has registered with Dot Com Avenue, and has paid them a fee for pre-registration and has not heard anything back, then we would like to hear from you."
vnunet.com has learned that one major high street bank has already handed back over £150,000 to customers and has withdrawn Dot Com Avenue's merchant services facilities.
The company that runs Dot Com Avenue, has also set up a second firm, .eu Registry Services, offering to pre-register .eu domain names.
In letters sent out by this company, it claims to be the operator of this suffix, which is in fact held by non-profit organisation the European Registry of Internet Domain Names. "We are proud to be operating the internet's most important regional domain name," it states.
Detective Constable Jody Faro told vnunet.com that there was no guarantee that those dealing with either .eu Registry Services or Dot Com Avenue would receive any form of product.
A man has been released on bail pending further enquiries by Cambridgeshire Police, which is investigating Dot Com Avenue, .eu Registry and another of his companies, Dot Biz Domain Renewal.
This third company claimed to be an accredited Icann registrar and urged businesses to renew their .biz domains long before the November 2003 deadline.
DC Faro would also like to hear from people who have paid money to these businesses.
Anyone with any information is asked to contact him at Cambridge Police Station on +44 (0) 1480 456 111.
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