Retail group fined $266k over misleading claims

A fashion retail group has been fined $266,000 after it was accused of lying to customers, saying a face mask was approved by overseas regulators.

Mosaic Brands, which owns nine Australian clothing brands including Crossroads, Rockmans, Millers, and Rivers, advertised a KN95 mask on its Autograph Fashion website in August last year.

It prominently described the mask as approved by the US Food and Drug Administration and Europe’s regulators, when it was not, according to the Australian Competition and Consumer Commission.

In the same month, Mosaic promoted a McGloin’s-branded hot water bottle on its Katies website saying it was approved by the commission, which does not endorse or approve any products.

Commissioner Liza Carver said the ACCC was “very concerned about the type of representations being made by Mosaic Brands”.

“Making false representations about the approval or endorsement of a product by any government authority misleads consumers and is likely to erode public trust in government authorities and certification marks.”

The commission slapped Mosaic with two infringement notices relating to the alleged false representations, and it said on Thursday the fashion retail group has paid $266,400 in penalties.

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No customers bought either of the products, and they were from a third party seller, a Mosaic spokesman said.

As soon as the retail group became aware of the issue, they were removed from the websites.

“Marketplaces are a common feature across all major local and international online retail sites and we have strict monitoring in place,” the spokesman said.

“Even with best endeavours in monitoring when (you’re) offering 5.8 million items there can be a tiny minority of third-party sellers who do the wrong thing.

“Given it concerned two products that were never purchased, out of a total of 5.8 million online items, we’re disappointed at the outcome.”

Mosaic has previously admitted making false or misleading claims about hand sanitiser and face masks on its websites during the pandemic.

In May 2021, it paid $630,000 in penalties after the commission hit it with five infringement notices.

At the time, Mosaic also committed to a three-year undertaking to implement a consumer law compliance program and refund scheme.

“These penalties are a warning to all businesses that making false or misleading representations about government approval for their products can lead to ACCC enforcement action, with serious consequences including penalties,” Carver said.

The Food and Drug Administration does not certify face masks directly, while putting the CE marking on products indicates they have been assessed to meet European safety, health and environmental protection requirements.

With AAP. (Content has been tweaked for length and style.)