Network steps up protection of 'at risk' consumers
Businesses which exploit vulnerable or disadvantaged* consumers are the focus of a new Australian Competition and Consumer Commission initiative, ACCC Chairman, Professor Allan Fels, warned today.
Launching a joint initiative by the ACCC and its Consumer Consultative Committee Professor Fels said that consumers who experience some form of vulnerability or disadvantage are at risk because they either have fewer means with which to beat unfair behaviour or fewer resources to cushion the impact of unlawful behaviour.
"Some can suffer extreme hardship as a result of unfair behaviour by businesses which more empowered consumers do not encounter", he said.
While the ACCC has done some work in this area, it is looking to step up its presence. Some action it has taken involving disadvantaged and vulnerable consumers over the last few years include**:
action on a scheme that misled needy consumers into making premium 1900 calls in the belief they could arrange a loan;
action to stop the sale of konjac mini-cup jellies that pose a high choking risk for children and the elderly;
action on a scam targeting unemployed young people through a premium rate 1900 number that promised young job seekers guaranteed employment as well as discounts on removal and accommodation costs;
action on stop misleading claims about cures for chronic fatigue syndrome, cancer AIDS and other serious illnesses;
action on telephone companies "slamming" customers (including the elderly and visually impaired) by into asking them to sign forms verifying the salesmen had attended when if fact the forms authorised changing telephony supplier.
"While 'at risk' consumers are a priority for the ACCC, they rarely complain directly to a big agency. Whilst there has been little research on this issue, in the report Consumer Redress Study, produced for Treasury in 1999, it is suggested that the consumer most likely to access a redress mechanism is a male between the ages of 35 â?? 45 living in a Metropolitan area who speaks English as first language and has at least completed high school or has some tertiary education. Our CCC members confirm that disadvantaged consumers are much more likely to complain to a â??shop frontâ?? or community based agency - if they complain at all.
"This initiative takes a partnership approach. It is a joint project between the ACCC and members of the CCC (which are consumer and community organisations). For its part the ACCC will prioritise investigation of issues that CCC members and other organisations refer to the ACCC where there is supporting evidence.
"To protect 'at risk' consumers the ACCC has created a special taskforce that will assess and fast-track complaints referred by CCC members and other organisations. It will:
target enforcement action to stop illegal conduct;
assist small and large businesses to identify, prevent and/ or cease offending practices; and
work with other government, business and consumer organisations.
"As part of the campaign, CCC member organisations are undertaking their own activities to support disadvantaged consumers by providing services such as advice, case management, life skills and education.
"Consumers who do not understand contracts are also unlikely to know that they have rights. It is important that businesses understand that it is illegal to take advantage of them.
"We have some information about worrying trends here and overseas:
high pressure door to door sales and lottery scams targeting the elderly;
misleading claims to induce people with severe financial difficulties to commit to costly 'rescue packages';
outlandish health claims which pray on the desperation of the chronically ill; and
sales programs which target consumers with a mental illness".
This campaign confirms that ACCC's commitment to investigate and take action where conduct crosses the line and breaches the Trade Practices Act.
"Businesses seeking to exploit vulnerability and rip off powerless people should know - those apparently powerless people have powerful allies", Professor Fels said.
The ACCC CCC invites both consumers and business to bring issues that impact on disadvantaged consumers to its attention through the ACCC Infocentre from Monday to Friday on 1300 302 502 or directly with CCC member organisations.
Release # MR 109/03
Issued: 2nd June 2003
CCC members:
Aboriginal Coordinating Council - Mr Peter Opio - 0410 320 157
Australian Consumers Association - Ms Louise Sylvan - 0411 572 800
Australian Federation of Disability Organisations - Mr Brian Rope Communications Law Centre - Mr Derek Wilding - 0425 242 401
Consumer Credit Legal Service (WA) - Ms Su Mahalingham - 0403 858 732
Consumer Law Centre of Victoria - Mr Chris Field - 0419 598 836
Consumers Federation of Australia - Mr David Tennant - 0409 570 557
Consumers Health Forum of Australia - Ms Sally Crossing
Country Womenâ??s Association of Australia - Mrs Myra Pincott - 0429 346 236
Tasmanian Council of Social Service - Mr David Owen - 03 6231 0755
* Characteristics that may suggest disadvantage include: low income; culturally and linguistically diverse background; disability (whether intellectual, psychiatric, physical or sensory); illiteracy; indigenousness; homelessness; remoteness.
Background
The ACCC established the CCC in November 2001. It meets four times per year. The CCC has been established to provide advice to the ACCC on issues affecting consumers that fall within the scope of the ACCCâ??s administration of the Trade Practices Act 1974. The CCC aims to provide tangible outcomes through work that it undertakes in partnership with member organisations.
