They started off flogging goods direct, now online retail partner Spreets who is now working with major consumer electronics retailers are facing the prospect of a $1M fine after being accused of misleading consumers about their daily deals.
The Australian Competition and Consumer Commission claims Spreets made false representations about the price of some deals, consumers’ ability to redeem vouchers and their rights to a refund, during 2011 and 2012.
Scoopon an online business similar to Spreets was fined $1M last year for similar offences. Scoopon was accused of misleading consumers about prices and their refund rights, and deceiving businesses about the risks involved in offering a deal through Scoopon.
Spreets has since stopped spruiking direct deals to the public, and now gathers and publishes deals offered by other retailers and online groups after their prior business model came under scrutiny.
The competition watchdog has warned online “daily deals” retailers against misleading shoppers after launching legal action against major player Spreets.
At the time, Spreets was one of the largest online group buying websites, offering discount vouchers to shoppers through its website, promotional emails and social media campaigns.
ACCC chairman Rod Sims said many complaints had been received by the ACCC since online group buying emerged in 2010.
“Businesses selling to consumers online have the same obligations under the Australian Consumer Law as all other businesses, and consumer guarantees, including refund rights, apply when consumers purchase online,” Mr Sims said.
“Online businesses must ensure that they do not mislead consumers and that the price and any restrictions on a deal being offered are clearly and accurately stated.”
