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ACCC Cracks Down On Lay-By Terms & Promos

The ACCC has cracked down on gift hamper company, Chrisco, after finding potentially unfair contract terms in its “HeadStart” lay-by plan. Chrisco has admitted it likely made false or misleading representations to customers in its promotion of the lay-by offer.

In addition to traditional Christmas and food hampers, Chrisco also sells a range of consumer electronics (pictured below) on its website, purchasable in part payments.

The HeadStart plan allowed Chrisco to continue taking payments from customers after they had fully paid-out their existing lay-by order, unless consumers expressly opt out.

Chrisco Hampers Australia has provided the ACCC a court-enforceable undertaking, and pledged to increase the transparency of its HeadStart plan terms. New contract terms will require consumer to confirm their participation from year to year.

In addition to an update of its terms and conditions, Chrisco has pledged to clearly and prominently explain terms to consumers including clarifying refund rights.

“All businesses must ensure they clearly explain to customers what plans or services they are signing up to, and how they operate,” asserts ACCC Commissioner, Sarah Court.

[chrisco.com.au]

The consumer watchdog was also concerned by Chrisco’s promotional emails and text send to thousands between 28 August 2018 – 21 April 2019. The asserts offered redeemable credit when clicking on an image – subsequently signing them up to a HeadStart plan without seeking consent.

Over 20,000 consumers were said to have signed up to the HeadStart plan via this promotion.

Chrisco has admitted that these promotional text messages and emails likely included false and misleading representations, contravening Australian Consumer Law.

“It is unacceptable that consumers were signed up to a HeadStart Plan and deductions were made from their bank accounts simply because they clicked on a promotional image in an email or text message,” adds Ms Court.

Chrisco has agreed to a comprehensive consumer compliance program for three years.

The news comes after the Federal Court penalised Chrisco a $200,000 pecuniary penalty for false and misleading representations preventing customers from cancelling a lay-by agreement after making their final payment.