Dell Australia fined $10M for misleading customers on discount prices

Recently, Dell Australia was found to have misled more than 4,250 customers and have been given a fine of $10M for making false and misleading representations about discount prices for add-on computer monitors after proceedings were brought by the Australian Competition and Consumer Commission (ACCC).

Dell advertises false and misleading savings claim

The proceedings began on 4 November 2022, when it was found that Dell Australia sold more than 5,300 products with add-on monitor pricing on their website including phrases such as “total savings”, “includes x% off”, ‘discounted price” and “get the best price for popular accessories when purchased with this product”.

These discount price statements were found to have been overstated and turned out to be a discount at all. In fact, customers found that they had paid more than if they had purchased a standalone product instead.

In a statement, ACCC Commissioner Liza Carver said: “This outcome sends a strong message to businesses that making false representations about prices or inflating discounts is a serious breach of consumer law and will attract substantial penalties”.

As a result, Dell Australia was ordered to offer refunds, issue corrective notices to all affected customers, and improve its compliance program, in addition to paying a $10M fine.

Undertaking the right checks and audits

To avoid receiving hefty penalties as a breach of consumer law, it is vital for businesses to ensure pricing and/or discount on goods DOES NOT mislead their customers. This means undertaking extra precautionary tests and checks to ensure your business is compliant.

According to the ACCC, businesses play a vital role in ensuring they’re honest in their dealings by avoiding gaining any unfair advantage by making misleading claims about their products and services. These may include information on prices, images and descriptions of what is offered, claims about the value of the products and services, and any type communication made by a business online and in print.

Key takeaways

• Businesses should take extra care not to make misleading statements about their prices. Prices must be clearly stated at all times to avoid creating false impressions.
• The ACCC has been unafraid to act on consumer complaints so having the proper documentation in place to refute these claims is key. Businesses will need to be agile in providing facts and evidence in the event this occurs.
• For each breach, businesses may be fined up to $50M or 30% of their annual turnover (whichever is greater).

For any questions regarding this decision or others, contact our trade and compliance experts at Macpherson Kelley.

The information contained in this article is general in nature and cannot be relied on as legal advice nor does it create an engagement. Please contact one of our lawyers listed above for advice about your specific situation.