Internet provider Activ8me has been hit with $250,000 in penalties, after a court found that the company had misled customers and failed to display a single price in its advertisements.
According to the ACCC, which prosecuted the case, Australian Private Networks Pty Ltd — which trades as Activ8me — was issued the quarter-of-a-million-dollar fine by the Federal Court last week, in addition to ordering the company to refund setup fees and allow affected customers to either switch or exit their plans free of charge.
The company had admitted to making false or misleading claims in three direct mail ads and five online banner ads between June and November 2018, relating to its Opticomm fibre-to-the-premises (FTTP) internet packages.
The direct mail-out ads alone reached more than 81,000 people, and were taken up by 793 customers during that period, according to the regulator.
“Activ8me told consumers they could access speeds of up to 100Mbps for $59.95 a month with no setup fee. In fact, the $59.95 plan only offered speeds of 12/1Mbps and a setup fee of $99.95 applied if the consumer did not sign up to a 12-month plan. The true cost of Activ8me’s 100Mbps plan was $89.95 per month,” the ACCC said in a statement.
“Activ8me also made a number of other false or misleading claims about price, inclusion of ‘unlimited’ data, speed and total minimum costs.”
ACCC deputy chair Delia Rickard said the claims made by the company “were blatantly wrong and misled hundreds of customers into signing up to internet services which were at a different price or speed than they expected”.
Ms Rickard said that the ACCC will continue to prosecute instances of businesses misrepresenting their products or services to consumers.
“Businesses are warned that misleading customers will result in ACCC action and potentially serious consequences,” she said.
It marked the second time in 12 months that the regulator had taken action against Activ8me. In early 2018, the company was found to have falsely claimed that its services were endorsed by the ACCC, resulting in a separate infringement notice worth $12,600 being issued.
Activ8me has been approached for comment on the latest proceedings.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.