The Australian Competition and Consumer Commission is pursuing an Australian marketing company and its sole director over allegedly misleading and unconscionable conduct.
The ACCC alleges Titan Marketing representatives misled consumers when it was conducting its door-to-door sales of first aid kits and water filters in indigenous communities and other locations across Queensland, New South Wales and the Northern Territory.
The consumer watchdog claims the marketing company violated unsolicited consumer agreement provisions stipulated by Australian Consumer Law, made false or misleading representations in relation to Titan’s affiliation with a charity group, refunds and value of the goods and signed consumers up to contracts with unfair terms.
The unfair terms in the contracts gave Titan the right to automatically debit the remaining contract amount from the consumer’s bank account or credit card if the consumer missed a payment.
ACCC chairman Rod Sims said in a statement protecting vulnerable consumers is a priority for the commission.
“The allegations against Titan include alleged conduct which took place in indigenous communities, where some consumers were particularly vulnerable and did not understand the contract documents.
“The ACCC will continue to take action to protect consumers in their homes from misleading and unconscionable conduct, particularly where the conduct affects disadvantaged or vulnerable consumers,” he said.
SmartCompany contacted Titan Marketing, but received no response prior to publication.
The watchdog is seeking declarations, injunctions, penalties, a community service order and costs from the marketing company.
Hall and Wilcox partner Sally Scott told SmartCompany the ACCC typically pursues cases which affect a large number of people or may set a precedent, but says these cases are not uncommon.
“The ACCC has pursued a number of companies over the past year for misleading and unconscionable conduct in connection with sales to those in indigenous communities, including by door-to-door sales and telemarketing.
“Any business involved in sales or marketing by telephone or door-to-door sales should ensure that management, directors and sales staff understand the requirements of the Australian Consumer Law,” she says.
Scott says it’s important companies understand they can be caught for misleading and unconscionable conduct, even if the behaviour was unintentional.
“Business should ensure that proper training is given, particularly to sales staff.
“ACCC chairman Rod Sims has shown a willingness to issue infringement notices and to litigate. The ACCC is pursuing another company at least every week. Companies cannot assume they won’t get caught if they contravene the Australian Consumer Law,” she says.
Earlier this year Energy Australia and four associated marketing companies came under fire from the ACCC for their door-knocking sales tactics, and in September last year Neighbourhood Energy and Australian Green Credits paid penalties totalling $1 million for illegal door-to-door selling practices.