The Australian Competition and Consumer Commission has launched legal action against four publishing companies and their sole director for allegedly ripping off small businesses.
The consumer watchdog has initiated the Federal Court proceedings against Andrew Clifford and the businesses – Exclusive Media & Publishing, Wiltshire Publishers, Superior Publications and Elite Publishing Group.
Wiltshire Publishers, Exclusive Media & Publishing and Superior Publications are based in Queensland. Elite Publishing Group is also based in Queensland and has no connection to Elite Publishing Co., a Melbourne-based company.
Clifford and the businesses are accused by the ACCC of “misrepresentations and harassment” of customers, which are mainly small businesses.
According to the watchdog, the publishing firms offered SMEs the chance to take out advertisements in their magazines at a cost of around $500.
However, despite promises that 500 copies of the publications would be distributed to selected organisations, the ACCC alleges that the copies were never sent.
The businesses, along with Clifford, their only director, are also accused of asking small businesses to sign an agreement that would provide them with complimentary copies of their magazines.
The ACCC says that after these magazines were returned, the publishers demanded payment for advertising services they claimed were part of the magazine offer.
The publishers used “harassment, coercion and acted unconscionably” when attempting to extract payment from the businesses, according to the ACCC.
This harassment allegedly included threatening legal action over non-payment and claims that court proceedings had commenced when they had, in fact, not done so.
The ACCC is seeking a ruling that will disqualify Clifford from managing corporations, as well as injunctions against future similar activity and financial penalties.
A directions hearing on the matter will be held on October 18. Clifford, via his solicitors, informed StartupSmart that he and the publishing companies deny the allegations and will contest the ACCC proceedings.
StartupSmart would like to make clear that Elite Publishing Co in Melbourne has nothing to do with the ACCC action, as was inferred in a previous version of this article. We apologise to the company for this mix-up.