Chrisco Ordered To Pay $200,000 Fine For Misleading Customer Payments

The federal court ruled that Chrisco Hampers Australia pay a penalty of $200,000 for making a misleading clause that customers could not cancel a lay-by agreement after making their final payment.

In their “HeadStart” plan Chrisco would continue to take payments by direct debit after the consumer had fully paid for their lay-by, as the payments would supposedly go towards the following year’s hamper. According to the terms of the lay-by agreement, consumers were required to ‘opt out’ in order to avoid having further payments automatically deducted by Chrisco after their current lay-by had been fully paid.

“We understand that making purchases by lay-by agreement is a convenient way for many Australians to shop, particularly for products such as Christmas hampers and presents” ACCC Chairman Rod Sims said.

“The Australian Consumer Law provides that lay-by agreements must be in writing and transparent.  Consumers have termination rights at any time before the delivery of the goods, subject to a reasonable termination charge in some circumstances,” Mr Sims said.

“The importance of the penalty imposed by the Court against Chrisco is that it sends a strong message to businesses using lay-by as a method of sale that they must meet all of their ACL obligations, and do not mislead consumers about their rights” Mr Sims said.

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