GE MasterCard customers refunded after review by ASIC

By James Wells

MELBOURNE: GE Money will refund consumers an establishment fee to 2,500 MasterCard customers following an investigation by the Australian Securities and Investments Commission (ASIC).

According to a statement issued this afternoon, GE’s announcement follows concerns raised by ASIC regarding the following statement on its website: "There is no annual fee for your GO MasterCard. That means it costs you nothing to have it – pay nothing and make it your card of choice year after year."

An investigation by ASIC found that while existing customers did not incur charges, new customers were charged a $25 establishment fee.

According to ASIC executive director of consumer protection, Greg Tanzer, while the fee was disclosed in other material, ASIC found that the representation was definitive and likely to mislead customers.

"This case highlights the need to ensure that definitive statements in advertising or promotional material are accurate. The fact that an investigation of all available material will provide consumers with a thorough understanding of the product does not excuse representations that are on their face likely to mislead," Tanzer said.

GE has now refunded the establishment fee to all consumers who applied for the MasterCard online. It has also removed the statement from the GO MasterCard website.

The GO Mastercard was launched prior to Christmas last year and has since been distributed to over 100,000 consumers. It was the first MasterCard to offer six months interest free on all purchases.

The card is designed to be used for interest free purchases through any retailers offering GE money finance. Users are also encouraged to join the free loyalty program which earns them shopping vouchers at Harvey Norman stores. Consumers who spend $10,000 on the GO MasterCard receive a $100 Harvey Norman voucher.

“Customers get one card that does it all: in-store promotions and MasterCard functionality. There’s no annual fee for the card and they get loyalty points on all MasterCard purchases,” said Harvey Norman chairman, Gerry Harvey at the launch of the card.

In the statement issued today, Tanzer acknowledged GE’s co-operation in responding to ASIC’s concerns.

"The issue of consumer redress in relation to misleading or potentially misleading conduct is a very important one. In that context, ASIC welcomes GE’s decision to refund the establishment fee to all potentially affected customers."

ASIC said the GO MasterCard was widely advertised through other means.

The statement considered by ASIC to be misleading did not appear as part of the broader advertising campaign, which included television and radio advertising, brochures, and in-store materials.
 

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