The Commerce Commission has initiated legal action against Brand Developers Limited, trading as The TV Shop, alleging the use of exploitative and misleading sales practices involving high-value products.
In a statement, Commission Deputy Chair Anne Callinan said the practices allegedly constituted unconscionable conduct, as they departed from accepted or expected business standards in New Zealand.
“This is behaviour that we expect to see rarely, as it is a clear and obvious departure from what is expected from businesses acting in good commercial conscience,” Callinan said.
“Simply put, the alleged conduct the Commission has uncovered here is some of the worst we have seen and involves the use of high-pressure sales tactics on customers who were vulnerable, including customers with cognitive impairments.”
ComCom has also brought a separate unconscionable conduct case against Tech Vault Enterprises Ltd, trading as HouseSmile, which is scheduled for sentencing at the Hamilton District Court on February 10.
“Both cases reinforce our commitment to acting firmly and decisively when we detect unconscionable conduct, which is an enforcement priority for the Commission,” Callinan said.
ComCom alleges that The TV Shop engaged in exploitative and misleading business practices between August 2022 and June 2024 in relation to the sale of high-value TEBO/Bambillo-branded beds and chairs.
“As well as the use of unfair, high-pressure sales tactics, we allege The TV Shop sold the products on long-term payment plans when it was aware they were unaffordable and without doing things like checking the customer understood the terms and nature of the sale, including the terms of the ‘30-day trial’,” Callinan said.
“We argue the company would then employ aggressive post-sale retention and debt collection tactics.”
“Some customers targeted by these tactics, which we say were carried out deliberately or recklessly, were suffering from serious illnesses, such as cancer, or symptoms of cognitive decline,” she added.
According to ComCom, businesses found guilty of unconscionable conduct can be convicted and fined up to $600,000, while individuals may face fines of up to $200,000.