The federal court has ordered an online business directory to pay $300,000 in penalties for “systemic unconscionable conduct, undue harassment” and misleading online advertising representations.
ABG Pages was an online business directory service that operated from 2009 until it closed in 2016 following action from the Australian Competition & Consumer Commission. The consumer watchdog instituted proceedings against the website in December 2016, alleging its services to a range of customers, including small business offered little-to-no value.
“The ACCC alleges that the conduct of ABG Pages resulted in a number of small businesses paying significant amounts of money to ABG Pages for advertising they did not want,” ACCC deputy chair Michael Schaper said at the time.
“We want to send a clear message that making false or misleading representations, engaging in high pressure sales tactics and unduly harassing customers to enter into contracts or pay invoices are not legitimate business strategies.”
The court has now also ordered ABG Pages’ sole director Michele McCullough to pay a $40,000 penalty and be disqualified from managing corporations for five years.
The ACCC reported today that ABG Pages and McCullough had admitted to breaching Australian consumer law by falsely representing that big businesses purchases their directory services, misleading businesses into entering contracts and refusing to cancel contracts that customers did not intend to enter into.
“ABG Pages took advantage of businesses, big and small, schools and local indigenous land councils, with some organisations paying up to $9000 each year for advertising in an online business directory they did not want and that had no value,” Schaper said.
“ABG Pages used high pressure sales tactics to sell listings in its online business directory and harassed staff chasing debts that didn’t exist – one customer was called 993 times by ABG Pages over a nine month period.
“The court’s judgment sends a clear message that ABG’s tactics are not legitimate business strategies. This conduct is unacceptable and businesses and individuals risk significant penalties if they’re also caught breaching the Australian Consumer Law.”
ABG Pages and McCullough were jointly ordered to make a $25,000 contribution toward the ACCC’s costs. McCullough was also ordered to attend a consumer law compliance program.