Fake product reviews and group buying next in line for ACCC crackdown

Businesses have been put on notice after the competition watchdog warned it will be cracking down on fake product reviews and online voucher rip-offs in the new year.

Following a spate of complaints about businesses taking advantage of customers or other companies, the Australian Competition and Consumer Commission has changed its focus.

While it will continue to scrutinise door-to-door selling – which led to fines of $1 million this year – a number of other issues have come to the fore.

According to ACCC chairman Rod Sims, fake online reviews have emerged as an issue as reviews become increasingly popular among consumers.

“Companies [are] either making [them] up themselves or getting other people to make up positive reviews,” Sims told News.com.au.

“Sometimes Blind Freddy can see what’s going on, but sometimes they are more subtle.”

The ACCC will also investigate group buying – which attracts around 140 complaints every month – and will continue to scrutinise companies that dodge consumer guarantees.

It will also maintain its special carbon tax taskforce, although Sims admitted carbon tax complaints “have slowed to four or five a day”.

The announcement comes one week after the ACCC released a free app to provide consumers with instant advice while they are out shopping.

According to ACCC deputy chair Delia Rickard, the app will “help to take the worry out of Christmas shopping”.

“Simple disputes over returns, refunds or replacements often leave shoppers confused about their rights,” Rickard said in a statement.

“The app answers commonly asked questions about refunds, returns, warranties, and lay-bys, such as ‘What do I do if a product is faulty?’ and ‘What happens if I don’t have a receipt?’.

“The app will allow consumers to store photographs of receipts as proof of purchase on their smartphone or tablet at the point of sale.

“Keeping your proof of purchase and checking the store’s returns policy if you have simply changed your mind can be important.”

Rickard pointed out the Australian Consumer Law provides stronger protections against faulty products, often allowing for repairs, replacements or refunds outside of a manufacturer’s or retailer’s warranty period.

“If products don’t work as promised or don’t work at all, you have rights as a consumer regardless of whether you bought it online, in a shop, full price or on sale,” she said.

“The app explains the steps to take when enforcing these consumer rights.”

The app also has a “My items” feature, which allows consumers to set reminders for when lay-bys are due, and the expiry date for warranties and gift vouchers.

It also explains common labelling terms like “Made in Australia”.

This article first appeared on StartupSmart.