ACCC and NSW Fair Trading take action against Unique International College
Thursday 5 November 2015 @ 9.32 a.m. | Legal Research | Trade & Commerce
It has been reported in a recent ACCC Media Release, that following a joint investigation by the Australian Competition and Consumer Commission (ACCC) and NSW Fair Trading into the conduct of private colleges, the ACCC and the Commonwealth (on behalf of the Department of Education and Training) have instituted proceedings in the Federal Court against Unique International College Pty Ltd (Unique).
Background
Unique sells VET FEE-HELP Diploma courses, costing from $22,000 to $25,000 per course, using face-to-face marketing, including door-to-door sales. In the 2014-15 financial year, Unique enrolled over 3,600 students in their Diploma courses and was paid approximately $57 million by the Commonwealth in respect of those enrolments.
The proceedings allege that Unique made false or misleading representations and engaged in misleading or deceptive and unconscionable conduct, in breach of the Australian Consumer Law (the ACL) [which is contained in Sch 2 to the Competition and Consumer Act 2010 (Cth)], when selling VET FEE-HELP funded courses between July 2014 and September 2015 in NSW.
The Allegations made against Unique
It is alleged that Unique offered prospective students a “free” laptop, and in doing so, represented that the course(s) were free or were free if the consumer did not earn approximately more than $50,000 per annum, when in fact consumers incurred a VET FEE-HELP debt payable to the Commonwealth Government if they earnt more than $54,126 in the 2014-2015 income year. Unique International College is owned and run by Amarjit Khela.
It is also alleged that Unique’s conduct, including its marketing and enrolment system and its dealings with some consumers was, in all the circumstances, unconscionable, in contravention of the ACL.
The ACCC Chairman, Rod Sims said:
“The conduct of concern allegedly targeted some of the most vulnerable groups in the Australian community, including consumers from remote areas and from low socio-economic backgrounds. Only 2.4 per cent of the consumers who signed up to and commenced Unique’s courses between 1 July 2014 and 30 December 2014 completed their course. We are particularly concerned that unscrupulous door-to-door marketing practices previously used in the energy sector are now appearing in the education sector. The joint investigation illustrates how seriously both agencies view these allegations. The ACCC and NSW Fair Trading are continuing to investigate the conduct of private colleges in the education sector”.
The NSW Fair Trading Commissioner Rod Stowe also said of this matter:
“It is alleged that the sales process used by Unique included free incentives, unfair tactics and the failure to provide clear and accurate information about the price of the courses and the nature of the VET FEE-HELP loan. It is important that colleges are upfront with prospective students and clearly explain the price of the courses they are offering. Consumers need to be able to fully understand what they are agreeing to before making a decision to sign up to a course. The VET FEE-HELP loan incurred by students is a lifetime debt.”
Penalties sought by the ACCC
The ACCC is seeking:
- declarations;
- Injunctions;
- redress for affected consumers (by cancelling VET FEE-HELP debts);
- pecuniary penalties;
- corrective notices; and
- orders requiring the implementation of a consumer law compliance program.
The ACCC and the Commonwealth are seeking orders for the repayment of course fees paid by the Commonwealth to Unique in respect of any VET FEE-HELP loans which are cancelled by court order, as well as costs.
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Sources:
ACCC takes action against Unique International College in Sydney – Article from sbs.com.au
ACCC takes action against Unique International College following joint investigation with NSW Fair Trading – ACCC Release MR 207/15
