Mosaic Brands has admitted that it breached the Australian Consumer Law in relation to its 'Health Essentials' products and has paid penalties totalling $630,000.
The ACCC issued five infringement notices to the retail group in relation to hand sanitisers and face masks advertised on its websites during the pandemic.
Specifically, the ACCC's notices concerned; Air Clean hand sanitiser that was sold on the Noni B website and Miaoyue hand sanitiser sold by Millers that were advertised to contain 70% and 75% alcohol respectively, when ACCC tests indicated they didn't; the sale of 'WHO-Approved' hand sanitisers that were not WHO-approved; the sale of 'CE/FDA certified' KN95 Kids Safety Face Masks that were not CE/FDA-certified; and, that KN 95 Adult Face Masks were "non-refundable" when consumers have a statutory right to a refund under the consumer guarantee remedies.
Speaking on the matter, ACCC chair Delia Rickard said that independent testing showed that the claims made by Mosaic Brands in relation to the hand sanitisers and face masks were not true.
"After a complaint from Choice, independent testing of the hand sanitisers commissioned by the ACCC found that one of the sanitisers tested contained an alcohol content of 17% and another had an alcohol content of 58%, below the percentage advertised on Mosaic Brands’ websites in each case.
"This was also below the minimum 60% alcohol concentration recommended by Australian health authorities.
"Our investigation also found that Mosaic Brands’ Kids KN95 mask was not certified by European and US standard authorities as they had advertised," she said.
Adding to the complaint was the way in which the products were advertised.
According to the ACCC, the products were marketed with phrases such as 'Be prepared', 'Stock up now before it’s gone', 'Remain Healthy' and 'Stay Safe and Clean', as well as references to the pandemic such as 'These are uncertain times and as the COVID-19 situation changes, we will be too' and 'It’s important we are all doing our part to protect the most vulnerable.'
The Health Essentials products were promoted at a time when COVID-19 restrictions were first announced by federal and state governments and there was intense public concern regarding the availability of sanitiser and face masks.
According to the ACCC, "tens of thousands of hand sanitiser and face mask products were sold on Mosaic Brands’ websites."
"Businesses must never mislead their customers about the certification, quality or properties of their products, but we were particularly concerned about the representations by Mosaic Brands because the statements which Mosaic Brands has admitted were false or misleading related to certain protective health properties at the time of a global pandemic," Rickard added.
Alongside its penalties, Mosaic Brands also signed a court-enforceable undertaking, agreeing 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 owns Katies, Noni B, Rockmans, Rivers, BeMe, Crossroads, Millers, W.Lane and Autograph.