Online electronics reseller Kogan.com has paid a $32,400 fine after the Australian Competition and Consumer Commission accused it of inflating standard prices to make its discounts look more attractive.
The consumer watchdog announced that three infringement notices were issued to Kogan with allegations that the company’s eBay site violated Australian Consumer Law with misleading prices for a Father’s Day sale.
The Kogan eBay store promoted a 20 percent discount on the Kogan 27-inch Cinema Display WQHD, Kogan 28-inch 4K LED Monitor and Asus 27-inch LED Monitor PB278Q for purchase between 24 and 29 August last year.
However, immediately before the sale Kogan had actually raised the prices of the three monitors, according to the ACCC.
“As a result, although consumers received a 20 percent discount off the newly increased prices, they in fact only received a 9 percent discount off the previously advertised prices for each of the three computer monitors,” stated the ACCC.
The Kogan eBay store then restored the original lower standard prices after the Father’s Day sale ended, the watchdog alleges.
“It is simply unacceptable for businesses to raise prices before applying a discount in order to give consumers the misleading impression that they are obtaining a larger percentage discount than is actually the case," said ACCC acting chair Dr Michael Schaper.
Kogan paid the fine in response to the infringement notices, although legally the payment is not an admission of guilt. CRN has contacted the online retailer for comment.
“Truth in advertising and consumer issues in the online market place are both current enforcement priorities,” Dr Schaper said.
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