Fake Online Reviews, Real World Consequences

Aveling Homes, a Perth-based home builder, is being taken to Court by the Australian Competition and Consumer Commission (ACCC) for misleading representations concerning consumer review websites.

It is alleged that the company created and controlled online review websites. They did this by actively creating review websites and giving the false impression that those websites were affiliated with an independent third party consumer review website. Further, it is alleged that the reviews on their website were misleading because they gave the impression of independence, when they were not, and it would obscure or remove unfavourable reviews.

This follows the ACCC action against Meriton Property Services Pty Ltd late last year concerning the manipulation of TripAdvisor reviews. It is alleged that Meriton sought to anticipate and prevent guests with negative reviews from posting their comments, by interfering with the agreed supply of customer data to TripAdvisor.

We will watch how the proceeding transpires.

These examples provide a timely warning for our clients, many of whom are aware of existing online reviews of their goods and services. With many consumers relying on such platforms for independent advice on purchases, the ACCC has a vested interest in monitoring and prosecuting such behaviour in the interest of protecting the consumer.

For readers considering such action, be aware that the arm of the law extends into cyberspace and may have real world consequences for you and your business under the Australian Consumer Law.

If you would like further advice on what you should or should not do as a business under the Australian Consumer Law, or advice on any grievance you have as a consumer, please contact Su-Ann Loh (Director, Dispute Resolution Practice Group) on 03 9629 9629.