Mosaic Brands was cashing in at the height of the COVID-19 lockdown in Australia last year, selling tens of thousands of hand sanitisers and face masks.
Since then the company behind some of Australia’s best-known suburban fashion labels has paid $630,000 in penalties for making false and misleading claims about its “health essential products”.
They were marketed with phrases such as “be prepared”, “stock up now before it’s gone”, “remain healthy” and “stay safe and clean”.
After a complaint from consumer advocate group CHOICE, the Australian Competition and Consumer Commission undertook independent testing of the hand sanitisers.
The ACCC has since issued five infringement notices to the largest speciality fashion retail group in Australia, which is behind the brands Noni B, Autograph, BeMe, Crossroads, Katies, Millers, Rivers, Rockmans and W.Lan.
The ACCC says Mosaic Brands made false or misleading representations about hand sanitisers and face masks advertised on its websites and via direct marketing between March and June last year.
The ACCC found:
* Hand sanitiser sold on the NoniB website was said to contain 70 per cent alcohol, when a sample tested was found to contain 17 per cent
* Hand sanitiser sold by Millers was said to contain 75 per cent alcohol, when a sample tested was found to contain 58 per cent
* Hand sanitiser products sold on its websites as “WHO-approved”, were not
* KN95 Kids Safety Face Masks sold on its websites falsely claimed to be ‘CE/FDA certified’
* KN 95 Adult Face Masks were advertised as “non-refundable” when consumers have a statutory right to a refund
The ACCC said the “health essentials” products were promoted at a time when COVID-19 restrictions were first announced and there was intense concern about the availability of sanitiser and face masks.
Tens of thousands of hand sanitisers and face masks were sold on Mosaic Brands’ websites.
ACCC deputy chair Delia Rickard said one of the sanitisers tested contained 17 per cent alcohol – well below the minimum 60 per cent recommended by Australian health authorities.
Hand sanitiser was being promoted with the false claim that it was approved by the World Health Organisation, which does not approve or certify hand sanitiser products.
“The statements which Mosaic Brands has admitted were false or misleading related to certain protective health properties at the time of a global pandemic,” Ms Rickard said in a statement on Thursday.
“Our investigation also found that Mosaic Brands’ Kids KN95 mask was not certified by European and US standard authorities as they had advertised.”
Mosaic Brands also agreed to refund customers under a redress program, implement a three-year compliance program, and properly substantiate its claims with respect to hand sanitisers and face masks, including by independent product testing.
Mosaic Brands admitted its conduct breached the Australian consumer law.