Noel Leeming fined $200,000 for misleading consumers

Friday 14th December 2018

Noel Leeming has been fined $200,000 for misleading consumers about their rights under the Consumer Guarantees Act following a Commerce Commission prosecution.

The homeware retailer, which is owned by The Warehouse Group, was convicted on eight charges under the Fair Trading Act with each charge relating to a different complainant.

The eight cases of Noel Leeming providing false or misleading misrepresentations about their rights occurred between September 2015 and January 2017 at seven different Noel Leeming stores across New Zealand – Noel Leeming has 77 stores nationwide.

The complainants purchased consumer goods such as mobile phones, laptops and household appliances.

Noel Leeming pleaded guilty in the Auckland District Court today and was fined by Judge Nicola Mathers.

“The prosecution related to multiple consumers in multiple locations. It was not isolated or one off conduct,” says commissioner Anna Rawlings.

“Consumers complained to Noel Leeming about products and were entitled to have their complaints treated seriously, investigated properly and remedied where appropriate,” she said.

“Instead, they were misled – sometimes repeatedly – about their rights under the law at a moment when it really mattered to consumers that their legal rights were honoured.”

Consumers were misled about their right to seek remedies for faulty goods from Noel Leeming, rather than the manufacturer, about their right to a refund for a faulty product, and about their right to a replacement for a faulty product.

Judge Mathers said there were “direct and significant departures from the truth" in every case.

"Consumers were denied their rights and had real difficulty dealing with Noel Leeming.”

Noel Leeming’s misrepresentations included telling a customer that claims under the Consumer Guarantees Act about an iPhone had to be negotiated directly with Apple, that the Act “is not effective” for Noel Leeming and that a consumer wasn’t entitled to a refund despite false representations made about the suitability of a mobile phone and that a customer had to contact Microsoft about a faulty product.

Other misrepresentations were that Noel Leeming could repair a fridge as many times as it liked and the customer was also told he could only get a store credit to purchase another fridge. Another customer was told mobile phones were only replaced within 14 days and that a new phone could only be obtained if a fault occurred three times.

All of these statements are simply wrong, Rawlings said.

Under the Act, it is the retailer who has to deal with complaints about faulty products and to either repair or replace the product or provide a refund.

Since 2007 the commission has warned Noel Leeming, or issued it with compliance advice, about potentially misleading of consumers about their rights.

(BusinessDesk)

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