Business penalised $215K for fake testimonials

Business penalised $215K for fake testimonials

by 0 comments

Real estate agencies have been put on notice after the Australian Competition and Consumer Commission pursued a non-industry firm over fake testimonials.

The Federal Court ordered the franchisor of the Electrodry Carpet Cleaning business to pay penalties of $215,000 for its involvement in publishing fake testimonials on the internet.

Following action by the ACCC, the court found that Electrodry posted and asked its franchisees to post fake testimonials on Google, Yelp and True Local.

This is a breach of the Australian Consumer Law that would also apply to any real estate agencies that adopted similar tactics.

In his judgement, Justice David Yates said that posting fake testimonials is serious conduct as it can mislead consumers and divert them from law-abiding rivals.

ACCC deputy chair Michael Schaper said online consumer issues remain an area of concern for the regulator.

“By manipulating or producing false reviews or testimonials, businesses mislead consumers who rely upon them when making purchasing decisions,” he said.

Earlier this year, Consumer Affairs Victoria accepted an enforceable undertaking from Accrue Property after it posted misleading information on its website that contravened the Australian Consumer Law.

[Related: Federal Court to rule on $1 real estate strategy]

promoted content
Recommended by Spike Native Network
Listen to other installment of the Real Estate Business Podcast
reb top 100 agents 2017

With a combined sales volume of over $14 billion in 2017, the Top 100 Agents ranking represents the very best sales agents in Australia. Find out what sets them apart and learn their secrets to success.

featured podcast

featured podcast
Marnie Seinor on structure, database DNA and connecting with her local community

There’s no such thing as an “off switch” in real estate – so says McGrath agent Marnie Seinor, who came in at number 78 in this year...

View all podcasts

Does the benefit of being part of a branded group outweigh the cost?

Depends on the group
Do you have an industry update?