News Sports

Dodgy mobile advertising on notice

Two budget phone companies have been forced to cough up thousands of dollars to the corporate regulator for making false claims about unlimited data allowances. Amaysim and Lycamobile will pay the Australian Competition & Consumer Commission close to $140,000 in penalties regarding separate false advertising claims about unlimited mobile data packages.It has been revealed in…

Two budget phone companies have been forced to cough up thousands of dollars to the corporate regulator for making false claims about unlimited data allowances.

Amaysim and Lycamobile will pay the Australian Competition & Consumer Commission close to $140,000 in penalties regarding separate false advertising claims about unlimited mobile data packages.

It has been revealed in the Federal Court that both companies lied about offering unlimited data, with advertised plans actually having capped data limits.

The Federal Court has ordered Amaysim to pay $126,000 for its misleading advertising, while Lycamobile will hand over $12,600 to the ACCC.

ACCC chair Rod Sims said both companies breached Australian consumer law by making sweeping statements about its offered service and did not disclose any ongoing costs outside of the contract.

“Consumers who saw the word ‘unlimited’ in the advertisements without any explanation of the limits of the plans were likely to expect they would not be charged additional fees for mobile data, no matter how much data they used,” he said.

Amaysim in January launched a social media campaign claiming unlimited data through slogans such as #UnlimitedMobileData and a statement “ … your mother loves the Unlimited Mobile Data offer from Amaysim”.

ACCC investigations revealed the unlimited data allowance was only available for the first three renewals before reverting to a capped amount that then charged customers for additional data if they exceeded their monthly limit.

Lycamobile, a British company that operates through the Telstra network, made misleading claims in November last year after it advertised unlimited data packages despite all plans having capped data allowances.

The ACCC said the advertising, predominantly published on Facebook, told consumers that the company’s Unlimited Plan S and Unlimited Plan M both offered limitless calls and data.

“The telco industry has been previously put on notice that their advertisements must be clear and transparent and must not contain claims like ‘unlimited’ without a clear and prominent disclosure of any qualification or exception which applies to the offer,” Mr Sims said.

“The amount of data included in a mobile phone plan is an important factor for many consumers in choosing a plan, and it is important that consumers can readily understand what they are signing up to.”

Leave a Comment

X

Coronavirus disease (COVID-19) outbreak

Coronavirus disease 2019 (COVID-19) is a respiratory illness that can spread from person to person. The virus that causes COVID-19 is a novel coronavirus.