ACCC contempt action results in jail sentence for director

19 May 2017

The Federal Court has sentenced the former company director of a parcel distribution business for 'Heartlink' branded products, Laurence Hann, to five months imprisonment for failing to comply with court orders made against him in May 2012, following ACCC action for contempt of Court.

The court found Mr Hann in contempt of court and ordered him to serve two weeks of the five-month sentence with the remainder suspended. The court also ordered Mr Hann to pay the ACCC’s full costs.

“This decision reinforces the importance of abiding by any orders which the ACCC has obtained for the protection of consumers,” ACCC Commissioner Sarah Court said.

In May 2012, the Federal Court found that Mr Hann had engaged in false, misleading or deceptive conduct, and been knowingly concerned in the conduct of three corporations that breached the Trade Practices Act 1974 (now the Competition and Consumer Act 2010). The Court found that, as a result of the conduct, consumers were misled about the profitability and earnings potential of the parcel distribution business opportunity as well as the overall viability of the business.

The Court imposed orders disqualifying Mr Hann from managing a corporation for 15 years, as well as injunctions preventing him for a period of 15 years from carrying on a business or supplying goods or services in connection with which:

  • persons are invited to invest money or perform work
  • any claim is made that moneys or profits earned by the sale of goods are donated to charity, or
  • goods or services concerned are or include household cleaning products.

The ACCC filed proceedings for contempt on 14 December 2015 alleging that Mr Hann had breached these injunctions by being involved in a business selling household cleaning products, claiming that some of the money from the sale of those goods would be donated to charity and recruiting a person to sell and distribute products in connection with that business.

On 7 October 2016, Justice Tracey made orders by consent that Mr Hann was guilty of each contempt charge brought by the ACCC.

In handing down his sentencing judgment yesterday Justice Tracey stated: “The offending which Mr Hann acknowledges is…of a most serious character.”

Background

For further details regarding the original judgment handed down in May 2012, see the following ACCC media release: Heartlink company director banned for 15 years and penalised $450,000 after ACCC action

Release number: 
MR 72/17
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