New Zealand Fair Trading Act – 2006 In Review

The Commerce Commission (Commission) monitors compliance with the Fair Trading Act, which is our principal consumer protection legislation. 2006 was a busy year for the Commission as it focused on product advertising and on generating fraud awareness amongst consumers. The year also saw the Commission pursue a number of high profile cases in relation to misleading pricing, particularly in the banking and air travel industries.

January/February

Fuel costs

The Commission commenced 2006 with a stern warning for businesses - fuel charges must be incorporated into the price, not added as a surcharge or additional charge. The Commission's warning followed a District Court ruling the previous year concerning Air New Zealand's advertising. In that ruling, the Court held that fuel costs are a normal operating cost of business and need to be included in prices. Since that judgment, the Commission has contacted over 70 businesses, finding 32 of those to be imposing additional fuel charges.

March/April

March: 'Fraud Awareness Month'

As part of Fraud Awareness Month, the Commission warned New Zealanders to be wary of scams promising great wealth for little input. They suggested consumers look out for certain characteristics which typically identify a scam. Scam identifiers include that the proposition comes out of the blue, sounds like a quick and easy way to make money, suggests there is almost no effort or risk, asks you to give personal information such as your banking details, and sounds too good to be true. The Commission drew consumers' attention to the following scams:

Lottery and prize scams

The Commission warned consumers to be aware of lottery and prize scams. In particular, consumers were warned of lottery scams initiated by a letter or email to a consumer alleging the consumer had won a significant prize in an overseas lottery. These emails often seek contact details and, if replied to, are followed by requests for bank account and identity information. The Commission urged consumers who receive such an email to, 'Check it, delete it, and destroy it.'

Phishing emails or calls

The Commission also warned consumers of the new intensity and technical sophistication of phishing scams. These scams include sending consumers emails, which are typically alleged to be from a New Zealand or Australian retail bank and include a link to an apparently authentic website. These emails aim to fool consumers into disclosing their personal banking...

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