A new election promise from The Labor Party would give the consumer watchdog the ability to fine scammers up to 10 million big ones. Currently, the maximum fine is $1.1 million for companies that breach Australian Consumer Law.
The Australian Competition and Consumer Commission has previously requested the change be implemented and recently appealed the $1.7 million penalty imposed on Neurofen maker Reckitt Benckiser over its ‘targeted relief’ claims. They argued that the fine was small compared to the profits the company had made on the associated products.
The largest penalty ever handed down was a $10 million fine to Coles for their mistreatment of suppliers.
The proposal would also implement the European Union’s penalty system for anti-competitive conduct, based on 30 percent of the yearly sales of the product or service, multiplied by the number of years the dodgy behaviour took place. It would be limited to the greater 10 percent of the company’s yearly turnover, or 10 million dollarydoos.
Spruiking for action on the matter, Labor said in a statement that the Coalition’s effort to protect consumers has amounted to “ ¯\_(ツ)_/¯ “. Fair deuce.
Shadow Assistant Treasurer Dr Andrew Leigh told news.com.au that tougher penalties should be in place to deter foul play.
“We ought to have penalties for consumer rip-offs that are as substantial as they are for anti-competitive conduct. And we ought to have penalties for anti-competitive conduct that don’t allow firms to profit from collusion.
“Right now because we’ve got a dollar limit on the fine, it can be possible to make a motza from colluding and then just treat it as a cost of doing business.”
Revenue raised from the fines would be used to increase the ACCC’s litigation budget by double ($24.5 million to $49 million).
Dr Leigh says the increased funding will make sure “the ACCC has the resources it needs.”
“Right now they get around 10,000 complaints every year and they’re able to take up about 60,” he says.
Feature image: Wolf of Wall Street