Australia’s largest specialty fashion retailer Mosaic (ASX:MOZ)
has been served a $630,000 penalty for misleading consumers into purchasing the company’s coronavirus prevention products.
Consumer rights watchdog CHOICE filed a complaint to the Australian Competition and Consumer Commission (ACCC), alleging that Mosaic’s retail stores committed false advertising to capitalise on the pandemic conditions.
The consumer market regulator accordingly conducted an investigation into the range of COVID-related products for sale at Mosaic’s retail brands . The inquiry’s findings showed that Mosaic misinformed buyers about the effectiveness of its health offerings falsely advertised as “health essentials” in last year’s June quarter.
The $65.7 million company’s marketing department distributed inaccurate information about Mosaic’s hand sanitiser and facial protection products to the public, invoking a sense of urgency to purchase sub-par products with catchphrases such as “stock up now before it’s gone”.
The company’s marketing collateral allegedly deceived customers into believing that their hand sanitiser had 53 per cent more alcohol than in reality and acquired non-existent World Health Organization (WHO) approval.
Noni and Millers’ owner’s advertising materials also claimed that its children’s facial masks received FE/CDA certification, which was later found to be untrue.
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