The Australian Competition and Consumer Commission has announced that it has instituted legal proceedings against Star Promotions Club Pty Ltd for misleadingly promoting mobile premium services.
The ACCC claims that the company is in breach of the Trade Practices Act 1974, due to the fact that it promoted a mobile premium service through a competition involving scratch cards.
The scratch cards offered various prizes to consumers including a holiday, plasma television and a car. The cards were placed in magazine and newspaper inserts and also letterbox drops.
It is alleged that the scratch cards did not adequately disclose the nature and cost of participating, particularly that anyone responding to the 19 number to claim a prize would be signed up to a premium rate mobile subscription service costing $6.60 per week.
A scheduling conference has been set down for 28 August 2009 in the Federal Court in Sydney.
This action is not the first instance the ACCC has found fault with mobile premium service providers. Some other actions of late include: TMG Asia Pacific Pty Ltd, Teracomm Limited, AMV Holdings and Clarion Marketing Australia Pty Ltd.