The arrest of six alleged scamsters who sold $1.6 million worth of fake magazine advertising to unsuspecting businesses is "the tip of the iceberg", says the head of the Serious Fraud Office.

Authorities moved in yesterday to arrest the suspects, serve search warrants and undertake other investigations at over 25 locations around the country.

Codenamed Operation Edit, the investigation was led by the SFO and involved five other government agencies, including the police and the Commerce Commission.

It is alleged that the group sold advertising in magazines that were either never printed or the number of magazines that were printed and circulated was grossly exaggerated.

The magazines were titled in a way suggesting "worthwhile causes" in subjects such as road safety, parenting or drug addiction, said an SFO statement.

The SFO said five of the accused had been charged with multiple fraud offences and with participating in an organised criminal group.

A sixth person was charged only with participating in an organised criminal group.

The scam was uncovered by TV3's Campbell Live current affairs show after a tip-off from a Rangiriri cafe owner who had been approached by one of the accused.

Anthony John Hendon and another man, James Stephen Burns of Wellington, appeared at Blenheim District Court yesterday. Hendon was arrested at his Waikawa Bay home, near Picton, by Organised Financial Crime Agency staff and police early yesterday.

They were remanded to reappear in Wellington District Court on November 14.

The four other accused are making their first appearances in courts around the country today.

The six arrested will be held in custody for three days to prevent them destroying evidence or speaking to witnesses.

The SFO's acting chief executive Simon McArley said there was plenty of anecdotal evidence that such "high volume, low value" scams were active in the New Zealand economy.

"A lot of the time they are small amounts [of money] and people shrug them off, but they add up," said McArley.

"It's just another cost that businesses can do without - times are tough enough as it is, you don't want to be paying people for things you haven't received."

McArley said it was not easy for the SFO to investigate and prosecute such cases because the cost of resources used outweighed the benefits.

But a multi-agency approach meant the investigation could be undertaken quickly and effectively, he said.

"It's not a South Canterbury Finance, it's not a $1 billion case, so targeting your resources on a purely monetary basis you'd walk past it, but our thinking is that there's probably a lot of this low level offending.

"[This case] is about getting something that we can get a grip on, using all the resources of the various agencies which would otherwise be unable to get to it, and sending a message that suddenly the risk of this sort of business model has gone up.'"

The Commerce Commission said it had handed over between 15 and 20 complaints received in the past year about the individuals and businesses that were targeted in the operation.

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