ACCC v Unique International College [2017] FCA 727: Respondent Found Guilty of False or Misleading Conduct
Tuesday 4 July 2017 @ 9.13 a.m. | Corporate & Regulatory | Trade & Commerce
In ACCC v Unique International College [2017] FCA 727 (30 June 2017), the Federal Court has found that Unique International College Pty Ltd (Unique) made false or misleading representations and engaged in a pattern of behaviour that amounted to unconscionable conduct and numerous breaches of the Australian Consumer Law (the ACL – contained in Sch 2 to the Competition and Consumer Act 2010 (Cth)).
Background to the Action
The Australian Competition and Consumer Commission (ACCC) and the Commonwealth (on behalf of the Department of Education) took action against Unique in October 2015 following a joint investigation with NSW Fair Trading into the training colleges sector.
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 for those enrolments. The training college is owned by Amarjit Singh with action being taken against the Unique International College in Granville, NSW.
Unique sold VET FEE-HELP diploma courses that cost between $10,000 to $25,000. In 2014 and 2015 Unique sales staff used tactics including door-to-door sales in vulnerable and disadvantaged communities. Several of those people enrolled by Unique lived in former Aboriginal missions in Bourke, Wagga Wagga, Walgett and Taree. ACCC Chairman Rod Sims said of Unique’s behaviour:
“The Court found that Unique’s marketing deliberately targeted people from disadvantaged and vulnerable groups, including regional Aboriginal communities. Many people were not even aware that they were being enrolled by Unique and unwittingly signed up to significant debts. Unique misled people by stating that the course was free, when in fact they would incur a debt up to $25,000 per course under the VET FEE-HELP scheme. Unique took advantage of some of the most vulnerable and disadvantaged members of our community. Our focus is now on ensuring that the affected consumers will not remain in debt because of Unique’s exploitative behaviour.”
The Judgment
Justice Perram found that the use of gifts including laptops and iPads was part of a system of conduct used to [at para 778]:
Court documents reveal that, in the financial year ending June 2013, Unique's audited accounts had a total revenue of $1,702,612 and a net profit after tax of just over $40,000.
By February the following year, Unique began to receive a monthly payment of just over $49,731, which was rapidly superseded by another approval for a monthly instalment of $2,475,000, or $29,700,000 annually.
In his judgment, His Honour said the 17-fold increase in revenue [at para 566-567]:
but added that it did "… not appear to have caused even a ripple at the department".
His Honour has previously criticised the VET-FEE Help scheme, acknowledging in 2016 that it was "hard to avoid, whoever put this scheme together did not think it through very much".
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Sources:
Unique International College was misleading and unconscionable, court finds – smh.com.au
Court finds Unique was misleading and unconscionable – ACCC Media Release 105/17
ACCC v Unique International College [2017] FCA 727 (30 June 2017)
