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Magnamail faces legal action over misleading promotions

Magnamail is facing legal action for allegedly making false or misleading statements in relation to “pre-draw” promotions in its mail-order catalogues.

The Australian Competition and Consumer Commission (ACCC) initiated proceedings against Magnamail and its parent company Direct Group, for allegedly being knowingly involved in the misconduct.

The proceedings concern 12 promotions between May 9, 2022, and July 7, 2023, which misled customers that they would qualify for a prize worth up to $10,000, $20,000 or $25,000, or a major prize such as an Apple iPad or jewellery if they ordered products from the mail catalogues.

The promotions included words suggesting the customers had been selected to participate and needed to order immediately to avoid losing the chance of winning.

However, the company had already pre-drawn the winners for the prizes.

Moreover, Magnamail also issued scratch cards to customers, but the cards were identical and scratching them to reveal the lucky number did not increase the chance of winning a prize.

“We are very concerned that Magnamail allegedly misled many consumers, some of whom were elderly or vulnerable, and may have enticed them to buy products by representing that they were, at that time, eligible for a major prize, even though they were not,” said Gina Cass-Gottlieb, ACCC chair.

“We are taking this action after being contacted by many consumers who received this promotional material and complained about their experience.”

The ACCC is seeking declarations, penalties, costs, injunctions, and other orders.

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