The Australian Competition and Consumer Commission has continued its crackdown on the telecommunications sector, forcing mobile phone retailer Dodo to offer refunds to customers who were lured in by the promise of a free computer or cash.
Between October 2008 and March 2009, Dodo advertised its “FREE $29.90 Mobility Cap Plan” with the added incentive of a free fuel card, a free Asus Eee PC or a free cash transfer into an account of their choice.
But the “free” extras weren’t exactly free. An ACCC investigation revealed that Dodo offered other cap plans (minus the fuel card, PC or cash) that were comparable in value and service level to the “Free Cap Plan” but cost up to $30 a month less.
Dodo promptly removed the ads after being informed of the ACCC’s investigations and has subsequently provided the consumer watchdog with a court enforceable undertaking.
“The ACCC has previously warned the telecommunications industry that practices
prohibited by the Trade Practices Act including misleading advertising are in the
ACCC’s sights,” ACCC chairman Graeme Samuel said in a statement.
“The telecommunications industry has had sufficient time to implement the necessary changes to address those practices. Those elements of the telecommunications industry that wish to test the ACCC’s resolve to reform the industry’s errant practices are on notice.”
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