Consumer watchdogs around Australia are cracking down on businesses that make savings claims about their goods, undertaking covert checks on more than 150 products.
NSW Fair Trading minister, Matthew Mason-Cox, has revealed that Fair Trading officers have visited 78 traders as part of a national campaign. The crackdown targets ‘was/now’ pricing claims, where a business displays a higher price compared to the current lower price to entice customers to take advantage of a discount.
Mason-Cox said, “Since March, fair trading regulators from around the country have been examining ‘was/now’ pricing and recommended retail price promotions”.
The traders that were visited were chosen based on complaints data and the retailers visited included furniture retailers, supermarkets, department stores, jewellers and other specialty retailers. 36 substantiation notices were issued nationally, with 13 of them issued to businesses in NSW.
“Key issues identified include a failure to previously sell at the ‘was’ price, variances in the period the product was sold at the ‘was’ price and the use of recommended retail price as the 'was' price and how this could be substantiated,” said Mason-Cox.
Businesses must be able to verify the accuracy of ‘was’ prices in order for advertising to be truthful.
While a majority of businesses were complying with their Australian Consumer Law obligations, “unannounced and covert checks” will continue to make sure businesses continue to advertise lawfully and in good faith.
Mr Mason-Cox said businesses that were caught out by Fair Trading Australia could face fines of $1.1 million for corporations and $220,000 for individuals.
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