The Federal Court has ordered penalties of $250,000 against internet provider Australian Private Networks Pty Ltd (trading as Activ8me) for making false or misleading representations and not displaying a single price when advertising its internet services.
The Court has also ordered that Activ8me offer to refund setup fees and allow affected customers to exit or switch plans without charge.
Activ8me admitted that between June and November 2018, it made false or misleading claims in three direct mail advertisements and five online banner advertisements marketing its Opticomm fibre-to-the-premises (FTTP) packages, in breach of the Australian Consumer Law.
Activ8me told consumers they could access speeds of up to 100Mbps for $59.95 a month with no setup fee. In fact, the $59.95 plan only offered speeds of 12/1Mbps and a set-up fee of $99.95 applied if the consumer did not sign up to a 12-month plan. The true cost of Activ8me’s 100Mbps plan was $89.95 per month.
Activ8me also made a number of other false or misleading claims about price, inclusion of ‘unlimited’ data, speed and total minimum costs.
“The misleading representations by Activ8me were blatantly wrong and misled hundreds of customers into signing up to internet services which were at a different price or speed than they expected” ACCC Deputy Chair Delia Rickard said.
Over 81,000 direct mail advertisements were sent to consumers, and 793 customers acquired Activ8me’s Opticomm network FTTP services during the relevant period.
Activ8me will send each affected customer a corrective notice and implement a consumer law compliance program.
“Businesses are warned that misleading customers will result in ACCC action and potentially serious consequences.” Ms Rickard said.
Activ8me admitted contravening the Australian Consumer Law, and the Court’s decision on penalty and other relief was based on a statement of agreed facts and submissions filed jointly by Activ8me and the ACCC.
Background
The ACCC instituted proceedings against Activ8me in December 2018.
The ACCC has engaged with Activ8me on two previous occasions in 2018 about its advertising.
On 1 March 2018 Activ8me paid an infringement notice penalty in relation to alleged misrepresentations that its internet services were endorsed by the ACCC.
In July 2018, Activ8me amended its advertising for NBN fixed wireless internet services following ACCC intervention.