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Consumers Should Be Wary Of Holiday Vouchers


Consumers Should Be Wary Of Holiday Vouchers


Consumers should be wary of telemarketers selling vouchers for free or discounted holidays, hotels and flights, the Commerce Commission warned today.

Adrian Sparrow, the Commission's Director, Fair Trading said, "Our contact centre is getting an increasing number of calls from consumers who are concerned that they will not be able to claim the services offered by the vouchers."

"Although there are legitimate companies offering vouchers that provide genuine discounts, any company selling vouchers that are not redeemable for the services that they claim risks breaching the Fair Trading Act," said Mr Sparrow.

"Consumers should be cautious and resist pressure to buy vouchers that offer discounts and services that seem too good to be true, especially those that come via 'cold call' telemarketing, without first determining whether the offer is legitimate."

In 2007 the Commission took action against a group of Australian companies operating in New Zealand under the name Discount Premium Holidays Ltd and their director, Devang Parikh, who were marketing a voucher programme in New Zealand. In November 2007, the Auckland High Court issued an injunction prohibiting Discount Premium Holidays Ltd , its director, and associated companies from making certain false and/or misleading representations about the cost and validity of their holiday voucher programme. The Court also required Discount Premium Holidays Ltd to positively disclose certain facts to consumers, including the price of their vouchers in New Zealand dollars.

The Commission's investigation into Discount Premium Holidays Ltd and Mr Parikh continues, and it remains interested in receiving information on any continuing activities by the company in New Zealand.

The Commission recommends that consumers contacted by telemarketers selling vouchers get details about the company that is marketing the vouchers. Consumer should also ask for details of which providers are involved in the voucher scheme, so that that they can check the offer before committing to purchasing vouchers.

"Telemarketers selling vouchers are often persuasive and use pressure selling techniques," Mr Sparrow said. "However consumers have the right to make informed decisions about products that they purchase. We strongly suggest that consumers satisfy themselves that they will be able to obtain value for money from any voucher that they choose to purchase. It is always advisable to take the time to check offers made over the phone."

The Commission is interested in hearing from consumers who have purchased 'free' vouchers or discounted holidays, hotels and flights, but have not been able to redeem them. Email contact@comcom.govt.nz or phone 0800 943 600.
Background

Only the courts can give an authoritative ruling as to whether conduct breaches the Act and award appropriate penalties. Criminal court action may result in fines of up to $60,000 per offence for an individual and $200,000 per offence for a company. Both a company and the individuals involved in a breach can be prosecuted by the Commission.

ends


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