As the busy holiday season comes to an end, it is time to ensure you aren’t the victim of fraud.
It is crucial for consumers to keep suppliers accountable for products and services they have purchased on the internet, over the phone or in person.
According to the latest Australian fraud reports, fraudulent activity has dramatically increased with over 400 million online credit card transactions being reported as fraudulent. Consumers should at least attempt to verify the legitimacy of the person or company from whom they are purchasing and the product or service being bought.
Consumers have been duped into purchasing fictitious ‘bargains’ by fraudulent sellers using enticing tactics. One unlucky (and perhaps, gullible) consumer spent $1,000.00 on a ‘certified’ signed copy of a Castaway DVD, which wasn’t an original or even signed by Tom Hanks.
Other examples of fraud include the seller accepting your hard-earned cash but not delivering the goods, where the goods being purchased do not even exist or the seller charging you for a certain number of a particular good but then delivering less than that quantity.
Fraud is described by the law as “fraudulent misrepresentation”. A representation is fraudulent if it was made with the intention of being acted on and was known by the representee to be false at the time it was made.
The following are real instances of consumers being fraudulently duped:
- Dealership Dilemma: A second hand vehicle was advertised and sold as “new” to the consumer. The consumer then became aware the vehicle was used and sued for fraudulent misrepresentation.
- Valuation Frustration: A seller represented to a buyer that the house was of “reasonable value” knowing that it was actually significantly overpriced. The buyer relied on the seller’s representation and purchased the house. The buyer then sued for fraudulent misrepresentation.
- Dodgy Document: A company issuing shares published a document regarding its financial viability knowing the document to be factually incorrect. The document was used to induce an investor to purchase shares in the company. The company was then wound up and the plaintiff sought damages after relying on the false document.
- Risky Receipt: When signing a dry cleaning receipt in front of the dry cleaner’s employee, a consumer was told that the dry cleaners would accept liability, but only for certain risks. Unknown to the consumer, the signed receipt contained an indemnity in favour of the dry cleaners from and against any and all liability arising from the cleaning of the wedding dress. The dress was returned by the dry cleaners with a stain and the consumer sued for fraudulent misrepresentation.
It is vital that consumers undertake regular stocktakes and check goods delivered against those ordered and paid for.
If you have purchased goods or services in reliance on a fraudulent statement or act by the supplier, please don’t hesitate to contact one of the lawyers in our Litigation and Dispute Resolution section.