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Dell to pay $10 million for making false and misleading representations

The Federal Court has ordered Dell Australia Pty Ltd to pay $10 million for making false and misleading representations on its website about discount prices for add-on computer monitors.

In enforcement proceedings brought by the ACCC, Dell Australia admitted that it had misled customers about the price of a selection of monitors available to ‘bundle’ with a purchase of a desktop, laptop or notebook. The add-on monitors were often advertised with a higher ‘strikethrough’ price, indicating a significant saving if purchased with other computer products.

Dell Australia admitted that it overstated the discounts customers received as monitors were not sold for the strikethrough price for most of the relevant time. In many cases, consumers paid more than if they had purchased the monitor as a standalone product. More than 5,300 monitors were sold to consumers with overstated discounts.

Dell Australia also admitted that it misled customers about the discounted price of the add-on monitors with various statements including “Total Savings”, “Includes x% off”, “Discounted Price” and “Get the best price for popular accessories when purchased with this product”.

“This outcome sends a strong message to businesses that making false representations about prices or inflating discounts is a serious breach of consumer law and will attract substantial penalties,” ACCC Commissioner Liza Carver said.

“We took this action against Dell Australia because consumers rely on accurate information about prices and discounts to make purchasing decisions. It is important that businesses are careful when advertising discount pricing to ensure they do not mislead consumers about the savings on offer,” Ms Carver said.

Earlier this year, the Court ordered Dell Australia to offer refunds and issue corrective notices to every affected consumer and review its compliance program. Dell Australia was also ordered to pay a contribution to the ACCC’s costs.

Dell Australia co-operated during the proceedings by admitting that it had contravened the Australian Consumer Law and made joint submissions with the ACCC in respect of penalty and other orders. It also commenced offering refunds to some consumers prior to the Court making orders.

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