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‘Misleading’ Parcel Distribution Company Director Hit With Jail Time

The former company director of a parcel distribution company for ‘Heartlink’ branded products has been sentenced to five months imprisonment by the Federal Court for being found guilty of contempt.

Laurence Hann was previously found in breach of the Trade Practices Act 1974 (now the Competition and Consumer Act 2010) as the result of action taken by the ACCC in May 2012. The Federal Court ruled that Hann had “misled about the profitability and earnings potential of the parcel distribution business opportunity as well as the overall viability of the business”.

As part of its ruling, the Federal Court penalised Hann $450,000 and banned him from managing a company for 15 years.

“It is the first time the ACCC has obtained orders from the Federal Court which disqualify an individual from managing companies,” ACCC chairman Rod Sims said at the time.

Additional injunctions were also put in place to prevent Hann from “carrying on a business or supplying goods or services in connection with which:”

  • persons are invited to invest money or perform work
  • any claim is made that moneys or profits earned by the sale of goods are donated to charity, or
  • goods or services concerned are or include household cleaning products.

However, the ACCC filed proceedings for contempt in December 2015 which alleged Hann had breached these injunctions by “being involved in a business selling household cleaning products, claiming that some of the money from the sale of those goods would be donated to charity and recruiting a person to sell and distribute products in connection with that business”.

Hann was found guilty by Justice Tracey in October 2016. After being found in contempt of court, Hann was ordered to serve two weeks of the five-month sentence, with the remainder suspended, and to pay the ACCC’s full costs.

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