The Federal Court has ordered Excite Mobile to pay $455,000 and its directors Obie Brown and David Samuel to pay $55,000 and $45,000 respectively for misconduct selling mobile phone services. An employee, Fiona Smart, must pay $3500.
The sentence follows a court win for the Australian Competition and Consumer Commission (ACCC) in April.
The Federal Court found that that Excite Mobile engaged in false, misleading and unconscionable conduct in its mobile phone services, including threats to repossess children's toys. The telco’s directors, Brown and Samuel, were both found to have knowingly breached Excite Mobile’s contraventions of the Trade Practices Act.
The court disqualified Brown from managing a corporation for three years, and the same for Samuel for two-and-a-half years. In addition, Brown, Samuel and Smart have been barred from engaging directly or indirectly in similar conduct for seven years. And the court ordered the three to pay the ACCC’s costs in the matter.
“This penalty against Excite Mobile serves as a warning to businesses, particularly small businesses, of the consequences for engaging in false, misleading and unconscionable telemarketing practices, and using undue coercion in relation to debt collection,” ACCC Chairman Rod Sims said in a statement.
“The penalties imposed on Excite Mobile’s directors, together with the disqualification orders imposed by the Court, signal that individual company directors will also personally be held to account when they are involved in sales and debt collection practices by the company that contravene consumer protection laws.”
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