27 Feb 2009

Warehouse fined $200,000 for misleading customers

4:59 pm on 27 February 2009

Retail chain The Warehouse has been fined almost $210,000 after pleading guilty to multiple breaches of the Fair Trading Act.

The Commerce Commission says it hopes other large retailers will take notice after The Warehouse pleaded guilty in Auckland District Court on Friday to multiple breaches of the act.

The charges related to The Warehouse misleading consumers about the advertised price of goods, using bait advertising, making false claims that certain products were exclusive to The Warehouse, and false labelling on some duvets.

The Warehouse, one of New Zealand's biggest retailers, says it did not deliberately try to mislead customers. It was fined $209,600.

The Commerce Commission's director of fair trading Adrian Sparrow says when a company such as The Warehouse breaches the Fair Trading Act thousands of consumers can be seriously affected.

Competitors that comply with the act also suffer, he says.

Mr Sparrow says the wide range of charges indicates the The Warehouse needs to ensure it does not breach the Fair Trading Act and mislead customers again.

The Warehouse on Friday apologised to customers. General manager of marketing Stuart Yorston says the company accepts the fine as a reminder that it must do better.

Mr Yorston says the company is working to eliminate this type of error from happening again.