Damages have been awarded to a number of distributors that were scammed into buying exclusive distribution licences for an overseas product, when the supply agreement never actually existed.
The Southport Magistrates Court in the Gold Coast heard that Eco Boss and its two directors, Samuel Edward Newnham and Adrian James Campbell, duped 11 distributors with a fake contract into buying the supposedly exclusive licences to sell and install a smoke detection technology.
The contract, reportedly from a UK company, claimed to offer exclusive distribution rights within select regions.
Both Mr Campbell and Mr Newnham pleaded guilty to 11 counts of making false and misleading representations.
The court handed the duo and their company penalties and costs worth close to $600,000.
Eco Boss was penalised $250,000, while both directors were ordered to pay $102,200 in restitution to the 11 distributors and court costs of $89.90.
Additionally, Mr Newnham was fined $40,000, while Mr Campbell received a higher fine of $85,000 as well as a conviction recorded against his name.
Queensland’s Office of Fair Trading said the hefty penalties reflect the level of manipulation involved and the financial impacts the scam had on those affected businesses, as well as their apparent lack of remorse for their actions.
“The conduct of Eco Boss Pty Ltd, Mr Campbell and Mr Newnham [were] calculated and manipulative, and there is no place in Queensland for traders who behave in such a deceptive and misleading manner,” the agency’s acting executive director, Craig Routledge, said.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.