Court orders radio ads to correct misleading conduct by Chubb following ACCC legal action

22 August 2001

Eighty-four corrective radio advertisements will be broadcast on 2UE, 3AW and 4BC during the morning and breakfast programs as part of corrective action following a Federal Court order that Chubb Security Australia Pty Ltd had engaged in false, misleading and deceptive conduct. The action was initiated by the Australian Competition and Consumer Commission.

The radio and print advertising claimed Chubb's Vitalcall personal response system cost about $1 a day. However, customers wanting to connect to Vitalcall had to pay an initial installation fee of between $80 to $279, depending upon the State in which they resided. The continuing monitoring fee is between $1.16 to $1.26 per day.

"If companies decide to advertise their products on radio by retaining the services of well known radio announcers, they must ensure that the advertisements do not make any false or misleading claims", ACCC Chairman, Professor Allan Fels, said today. "Such companies must also be prepared to have the same announcers in similar timeslots read corrective advertisements.

Justice Madgwick of the Federal Court of Australia also made the following orders, by consent:

  • an injunction restraining Chubb from making future representations about the cost of Vitalcall without disclosing all associated costs

  • corrective letters to be sent to all Chubb customers identified as having become aware of Vitalcall through the print and radio advertisements to offer a refund of the installation costs if the consumers were misled by the advertisements

  • corrective advertisements to be printed in the Daily Telegraph and Herald-Sun

  • corrective pre-recorded and 'live read' radio advertisements to be broadcast on all the radio stations where the original advertisements were broadcast.

The Vitalcall system is specifically targeted towards people over 75 years of age or people with a disability aged between 65-74 years. It comprises of a small pendant (radio transmitter) and a talkback unit connected to the telephone. The user wears the pendant around the neck and can press it to activate a signal to the talkback unit. The unit will automatically telephone the Vitalcall monitoring centre.

The monitoring centre staff assess the call and provide assistance. Chubb broadcast a large number of radio advertisements, a significant proportion of which were 'live reads', between July to November 2000 and between 1-15 April this year. Approximately 74 live read advertisements were made by a number of radio presenters over these periods.

"Businesses must be aware that to effectively correct misleading representation there must be proportionality between the initial advertisements and the corrective advertisements in both the number of advertisements and the types of advertisements run", Professor Fels said.

"In total 84 corrective radio advertisements are to be broadcast on Radio Stations 2UE, 3AW and 4BC during the breakfast and morning timeslots. Twenty-four of the corrective advertisements are to be 'live reads'. "The ACCC is particularly concerned to ensure companies do not mislead elderly consumers such as those targeted by these advertisements.

This outcome sends a clear message to companies that the ACCC will not hesitate to enforce the consumer protection provisions of the Trade Practices Act 1974 in order to protect consumers from this type of misleading advertising".

Consumers who require further information about obtaining a refund can contact the ACCC Information Centre on 1300 302 502.

Release number: 
MR 195/01
ACCC Infocentre: 

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