Online retailer Kogan has been fined for breaches of Australian spam laws after it sent more than 42 million emails that did not allow the recipient to easily unsubscribe from.
A $310,800 infringement notice has been issued by the Australian Communications and Media Authority (ACMA) who found that “Kogan required consumers to take additional steps setting password and logging into a Kogan account,” in order to stop receiving emails.
ACMA fined Kogan $310,800 for breaches of Australian spam laws having sent 42 million emails to consumers that did not comply with the Australian Spam Act.
Under the Spam Act, ACMA says that organisations sending marketing emails must meet three criteria:
- The email clearly identifies your organisation as the sender
- The message contains accurate contact details
- The email makes it easy for a recipient to unsubscribe from the messages.
More specifically, the option to unsubscribe should present it “clearly,” does not require a fee, should be functional for 30 days and honours the request within five working days.
Chair of ACMA, Nerida O’Loughlin has issued a statement saying that “Kogan’s breaches have affected millions of consumers,” adding that “ACMA received complaints from a number of recipients of Kogan’s email expressing their frustration and concern with Kogan’s practices.”
“This substantial infringement notice and comprehensive three-year-enforceable undertaking sends a message to Kogan and other businesses that the ACMA will take strong action for breaches of the spam rules,” O’Loughlin said.
The Australian Communications and Media Authority has in the past 18-months handed out $2.1 million worth of infringement notices to companies breaching anti-spam and telemarketing laws.
ACMA has also issued ten formal warnings, and accepted the terms of nine other court-enforceable undertakings for companies to review their processes and meet relevant anti-spam laws.
“Businesses must comply with the unsubscribe requirements in the spam rules. This investigation makes clear that businesses can’t force customers to set a password and login to unsubscribe from receiving commercial messages.”
O’Loughlin continued to explain that “the ACMA sent Kogan multiple compliance alerts before commencing this investigation. These notifications are designed to alert businesses of potential non-compliance with the Spam Act.”
The Australian Communications and Media Authority has accepted a three-year, court-enforceable review of its marketing practices to ensure that it does not breach the relevant spam laws with emails in the future.
According to the release, Kogan has agreed to appoint an independent consultant to conduct a review of its marketing systems, processes and procedures, and for the company to comply with any recommendations made.
This applies to any brands under the Kogan Australia Pty Ltd, including Kogan and Dick Smith brands.
The ACMA has also mandated that Kogan train its team that are responsible for creating and sending marketing emails to report to the ACMA on a regular basis on the actions it has taken to meet Australia’s spam laws.
“ACMA alerts put businesses on notice – address consumer concerns or we will investigate you under the law, as we have done here. That said, we acknowledge that Kogan fully cooperated with the ACMA in our investigation and took actions to update their unsubscribe facilities prior to its completion.”
Under current spam laws, repeat corporate offenders found to breach spam laws with marketing emails can face penalties of up to $1.11 million per day.