ACCC v Acquire Learning & Careers Pty Ltd [2017] FCA 602: Acquire Learning Fined for Engaging in Unconscionable Conduct

Friday 23 June 2017 @ 9.29 a.m. | Legal Research | Trade & Commerce

In the case of ACCC v Acquire Learning & Careers Pty Ltd [2017] FCA 602 (30 May 2017), the Federal Court has ordered Acquire Learning & Careers Pty Ltd (Acquire) to pay penalties of $4.5 million for engaging in unconscionable conduct, making false or misleading representations and breaching the unsolicited consumer agreements provisions in the Australian Consumer Law (the ACL – which is contained in Sch 2 to the Competition and Consumer Act 2010 (Cth)).

Background to the Case

Acquire telemarketers were paid based on the number of consumers referred and enrolled in online VET FEE-HELP assisted courses. Acquire admitted in joint submissions that it had made false or misleading representations and that its sales tactics towards eight identified consumers were unconscionable. Acquire also admitted that this conduct was clearly unfair or unreasonable, and inconsistent with the prevailing business and social values that underpin acceptable standards which apply to dealings with consumers.

Consumer advocates began raising concerns about Acquire’s business practices in 2014, and the ACCC took action against the company in 2015. New rules announced at the end of 2016 was part of the Federal Government’s overhaul of VET FEE-HELP loans scheme, and banned the use of brokers to recruit students, stopping Acquire from operating.

The Judgment

Justice Murphy described Acquire’s conduct in which it [at para 90]:

“… rorted the VET FEE-HELP scheme as ‘deliberate and overt’ … [Acquire’s business model was] based on maximising the number of enrolments it was able to achieve for its clients and thereby maximise the fees payable to it.”

And at [para 88]:

“The deliberateness of the contravening conduct, its nature in targeting vulnerable people, the losses suffered by the Commonwealth, and Acquire’s status as a market leader, indicates a strong requirement for general and specific deterrence. Its activities resembled those of an unscrupulous fly-by-night operation rather than those of a prominent and market leading provider of student recruitment services, as it describes itself.”

Comment from the ACCC

ACCC Commissioner Sarah Court said:

“Acquire took advantage of vulnerable consumers by using unfair sales tactics to pressure consumers to enrol in a vocational training course and apply for VET FEE-HELP assistance. The ACCC relied upon recordings of calls by telemarketers to eight consumers to support its allegation of unconscionable conduct. These consumers were vulnerable, at a disadvantage, and pressured into unsuitable online courses given their individual backgrounds and educational capabilities.”

Ms Court said went on to say:

“The penalty of $4.5 million imposed by the Court is the ACCC’s second largest consumer protection penalty. Businesses are warned that using unfair sales tactics and making misleading representations to pressure vulnerable consumers is unacceptable.”

Further Court Action against Acquire

The Court also made orders restraining Acquire from making representations about the uses or benefits of enrolling in a course without having a reasonable basis for doing so, that Acquire Learning undertake six monthly reviews of its existing compliance programme for a period of three years to ensure its effectiveness, and that Acquire pay $100,000 towards the ACCC’s costs.

Cooperation with the ACCC

Acquire cooperated with the ACCC’s action, including by making admissions and agreeing joint submissions on penalty which were filed with the court. In April 2017, Acquire Learning was placed into voluntary administration.

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Sources:

ACCC v Acquire Learning & Careers Pty Ltd [2017] FCA 602 (30 May 2017)

Education broker Acquire Learning fined $4.5 million – news.com.au

Court orders Acquire to pay $4.5 million penalty – ACCC Media Release MR 79/17

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