Warning to businesses when using consumer testimonials

A company admitting to publishing false consumer testimonials has been issued with a $6,600 fine by the Australian Competition and Consumer Commission (ACCC), following the introduction of new consumer laws in January 2011.

The Australian Consumer Law forms part of the Competition and Consumer Act (formerly the Trade Practices Act) and includes express prohibitions against making false or misleading testimonials.

This prohibition applies to testimonials that are completely fictitious as well as those that are merely misrepresented or misquoted.

Citymove, a removalist company that operates Australia-wide, copied reviews from other websites and published them on its ‘Moving Review’ website, with some details changed, such as the star rating and name of the removalist company.

The website has now been taken down by Citymove, and the company has agreed to a court enforceable undertaking after admitting to the publication of the false testimonials.

Businesses should be aware that the ACCC, as well as the general public, may review all publications and websites for accuracy of testimonials.

Penalties for publishing false or misleading testimonials can cause significant damage to the reputation of a business, let alone to the the hip pocket.

Policies and procedures should be put in place to ensure the accuracy of testimonials published online or in promotional material.

If you are concerned that your business may not be complying with the new laws under the Competition and Consumer Act, contact Certus Legal Group for information and advice.