An Australian company has been fined $600,000 for publishing fake or misleading reviews on its platform by the competition watchdog.
The Australian Competition and Consumer Commission (ACCC) has handed Service Seeking the hefty fine after it found it was making “false or misleading representations regarding reviews” of its services online.
In addition to the $600,000 fine, the court has ordered corrective notices, injunctions and the assurance Service Seeking will add a compliance program to its operations.
Service Seeking was created in 2007, and aims to provide customers with an online means of obtaining a quote for construction, cleaning and other services. The company has admitted to presenting reviews to customers that were written internally, a legally-binding breach of trust.
The company created its ‘Fast Feedback’ feature, which allowed customers and businesses using the service to review each other. Once a review was written by one party, it was sent to the other for confirmation of facts, to ensure the review was factually accurate.
The problem, according to the ACCC, was that if a review was left for more than three days, it would be published on the site- accurate or not.
By 2018, when the ACCC began its investigation into Service Seeking, the company had 1.5 million customer accounts, with 170,000 businesses registered on its platform.
According to a report from Smart Company, “this feature was used to create about 21,000 reviews between July 12, 2016 and November 29, 2018. Some 17,000 of those reviews were published automatically, without any input from the customer themselves.”
Service Seeking has made submissions to the Federal Court andt the ACCC accepting responsibility for publishing fake or misleading reviews.
“The case related to a small proportion of reviews published between 2016 and 2018 after which the Fast Feedback feature was removed from the site,” a spokesperson from Service Seeking said.
Justice Jackson, however, said in court documents that the company had acted in “a systematic course of conduct for the self-interested purpose of increasing the attractiveness of its website to businesses and customers in a manner which it must have known would give rise to numerous instances of misleading conduct.”
“This was an abuse of the trust that customers can be inferred to have placed in the site,” he said.
Deputy Chair of the ACCC, Delia Rickhard has said that this is a prime example of an organisation abusing the trust that customers hold toward the accuracy of online reviews that can otherwise sway an important buying decision.
“Deceiving them about the authenticity of the reviews in my view is showing contempt for consumers,” she said.
“Online reviews need to accurately reflect the independent views and feedback of genuine customers, or the business publishing them risks breaching the Australian Consumer Law.”