Misled by an Advertisement? Here’s What You Can Do
Have you ever come across an advertisement while shopping online or walking past a storefront and thought to yourself, “this sounds too good to be true”? It may very well be that it is in fact too good to be true, and the advertisement, which is meant precisely to capture your attention, is designed to present an overly rosy picture of the product/service being offered. However, there is a fine but clear line between advertisements that are creative and effective, and those that are plainly misleading.
If unfortunately, you have fallen prey to misleading advertising, take heart in the fact that you are not alone and there are possible avenues of recourse. There are a number of news reports available online of errant retailers or unsuspecting consumers in Singapore, but these are merely snapshots of a much wider problem.
This article will cover the following questions that one may have on the subject of misleading advertisements:
What is a Misleading Advertisement?
The Singapore Code of Advertising Practice (SCAP) is a set of guidelines which seeks to foster a high standard of ethics in advertising. Under the SCAP, advertisements are misleading if they are inaccurate, ambiguous, exaggerated, or omit important details. Specifically, advertisements will be considered to be misleading if they do any of the following:
- Misrepresent any matter likely to influence consumers’ attitudes to any product, advertiser, or promoter. For example, an advertisement stating that a car uses “clean diesel” in order to attract environmentally-conscious consumers, when in fact the results of emissions tests have been fabricated;
- Misrepresent any information to mislead consumers into believing any matter that is not true, such as the source of the product, quality of the product, obligation (or non-obligation) in using a trial product, and others. For example, an advertisement for shoes which states that they could help wearers burn calories, when in fact there are no scientifically-proven health benefits from just wearing the shoes; or in another example closer to home, a company misleadingly advertised that alkaline or filtered water can prevent or improve the condition of diseases such as cancer, diabetes and arthritis, when in fact such benefits were unproven; or concealing the information that while a trial product is free to use, the consumer is expected to pay the cost of returning the good;
- Mislead consumers about the price of goods or services. For example, an advertisement by a supermarket stating that there is a nationwide sale on a product, but consumers are charged different prices at different outlets for the same product;
- Underestimate the actual total price to be paid. For example, an advertisement which states that tickets to a certain destination costs only $1000, but omits to mention that there are additional charges such as a $100 booking fee and a $200 fuel surcharge;
- Mislead consumers to overestimate the value or mislead consumers regarding the conditions on the terms of payment such as hire purchase, leasing, instalment sales and credit sales. For example, an advertisement that states that customers can opt to pay a lump sum figure upfront or through monthly instalments interest-free, but upon further calculation, the total sales price when paid by instalments is higher than the total sales price when paid upfront; or
- Mislead consumers regarding the terms or guarantee, delivery, exchange, return, repair and maintenance; and mislead consumers regarding the extent of benefits for charitable causes. For example, an advertisement stating that the product manufacturer will provide free repair services if defects are detected during a specified period, but omits to mention that consumers must bear the costs of transportation, any replacements needed etc.
Apart from the examples above, there are other tactics that retailers or companies may employ that are misleading in nature while marketing their goods or services. The most commonly used online tactics employed by online retailers, according to the Competition and Consumer Commission of Singapore (CCCS) are as follows:
- False or misleading information on business location: An online retailer might advertise its products and services on a third-party platform like Lazada / Shopee, or through its own website. In its advertisements, it may falsely claim that it has a physical presence in Singapore in order to reassure its purchases in Singapore that the company can be reached easily if the product turns out to be faulty. The online retailer may do so by including the abbreviation “sg” in its domain (e.g. productsg.com), or may state on the advertisement itself that it is a “Singapore-based” manufacturer.
- False or misleading claims about the product sold: The online retailer may also make claims about the brand, quality, country of origin, or accreditation/awards received in relation to its advertised product when in actuality, the product eventually delivered is completely different.
- Seemingly large discounts: Another common tactic employed by online retailers is to advertise extremely low prices to draw consumers, claiming for example that it is a clearance sale. This is used especially for seemingly luxury products. However, when the consumer completes the purchase, the discounts may not be genuine (e.g. while a large sign bearing the text “85% discount storewide” is placed in front of the store, only certain items in the store are discounted at 85%, with the majority of items being sold at full price or with only a slight discount), or the product itself may not be genuine.
- False contact information for consumer refunds and redress: Lastly, online retailers may also promise the sky in terms of refund or exchange policies, but provide false contact information (e.g. unused phone numbers or unused email addresses) so that consumers are unable to reach the online retailers after completing the purchase.
More information on these tactics has been set out in an advisory issued by the CCCS.
Are Misleading Advertisements Illegal in Singapore?
While the SCAP does not have any force of law in Singapore, i.e. advertisers will not be subject to any criminal sanctions for breaching the SCAP, the Advertising Standards Authority of Singapore (ASAS), which administers the SCAP, has certain powers which include:
- Asking the advertiser or advertising agency to amend or withdraw any advertisements that are in breach of the SCAP.
- Requesting its members to sanction advertisers or advertising agencies which are in breach of the SCAP, including withdrawing facilities, rights or services from such advertisers or advertising agencies.
- Withholding advertising space or time from advertisers, and withdrawing trading privileges from advertising agencies.
- Adverse publicity, i.e. publishing details of the outcome of investigations, naming advertisers or advertising agencies which are in breach of the SCAP.
Additionally, retailers that put out misleading advertisements may also be caught under the Consumer Protection (Fair Trading) Act (CPFTA), which prohibits unfair practices, including the making of false or misleading claims. The CCCS is the administering agency of the CPFTA, with investigative and enforcement powers. As a result, the CCCS can take action against errant retailers that engage in unfair practices. In particular, the CCCS may:
- Pursuant to section 9 of the CPFTA, file applications with the courts against retailers engaging or likely to engage in unfair practices, for a declaration that the practice is an unfair practice, or for an injunction restraining the retailer from engaging in the unfair practice.
- If the retailer refuses to or does not comply with the injunction orders by the courts, commence an application against the retailer for contempt of court, which is a criminal offence that may result in a fine and/or imprisonment.
What Avenues of Recourse Do I Have as a Consumer?
The most common example of a consumer who may feel aggrieved because of a misleading advertisement would be a consumer who purchases a product on the basis of the advertisement and receives a product or service that is completely different to what had been advertised. In such a situation, the consumer has a few possible avenues of recourse.
Reaching out to the retailer, logistics service provider and/or the bank directly
The first port of call for a consumer may be to reach out to the retailer directly, via the contact information provided by the retailer, and attempt to resolve the dispute. This will usually take the form of asking to return the unsatisfactory product and for a refund of the monies paid, or for an exchange of the unsatisfactory product for another product offered by the retailer. This may or may not be effective, depending on how amenable the retailer is, but it is also the least costly and least litigious method of resolving the dispute, as the matter stays between you, as the consumer, and the retailer.
Instead of reaching out to the retailer, if you paid with your credit card, you can also approach your card issuing bank to lodge a chargeback. Typically, your chargeback request must be filed within 120 days from the date of the transaction. The bank will investigate the validity of the claim and whether other conditions are met, e.g., the consumer must have returned the goods and attempted to resolve the issue with the business.
Lodging a claim with the Small Claims Tribunals (SCT)
Another option that is available to you is to lodge a claim with the SCT, which is a dispute resolution centre of the State Courts that resolves certain specific types of low-value disputes between consumers and suppliers. In order for your claim to be eligible to be resolved at the SCT, the value of the claim must be no more than $20,000, or $30,000 if agreed by both parties. The main benefit of resolving your claim with the SCT is that it is quicker and less expensive than if you sued the retailer and brought the claim to a civil trial. However, do note that the two main limitations with regard to lodging a claim with the SCT are:
- The retailer that you are bringing the claim against must be operating in Singapore; and
- The SCT will only hear your claim if the purchase happened within the past 2 years. In other words, if your purchase occurred more than 2 years ago, you will not be able to lodge your claim with the SCT.
You can read more about making a claim in the SCT in Singapore in our other article.
Lodging a complaint with the Consumers Association of Singapore (CASE)
Alternatively, you may wish to lodge a complaint with CASE. CASE is a non-profit, non-governmental organisation, and its main purpose is the protection of consumers’ interests through educating consumers, working with retailers, and pushing for fairer legislation with regard to consumer issues.
If you have a dispute with a retailer over products/services purchased, you can approach CASE for advice and assistance, either by calling their hotline for general queries, or making an appointment for a consultation with a consumer relations officer at the CASE office itself. You may also wish to submit your complaints online, and will have to attach the relevant supporting documents and invoices when submitting your complaint.
After you have contacted CASE, CASE will be able to assist you in one or more of the following ways:
- A consumer relations officer will assess your matter and provide you with advice on the various possible options to resolve it. This service is completely free-of-charge.
- If you need further assistance, the consumer relations officer can draft a one-time letter to the retailer for you, so that you can negotiate with the retailer directly. The consumer relations officer will include details of your concerns and your desired outcomes in the letter, so as to facilitate any negotiations. Ultimately, you will have to deliver the letter personally to the retailer yourself. A $10 administrative fee (subject to GST) will be chargeable for this service.
- Lastly, if you have attempted to negotiate with the retailer, but the retailer is persistently unresponsive or unwilling to settle the matter with you, you can also opt for CASE to take a more involved approach in resolving your dispute with the retailer. In order to do so, you have to file a claim with CASE, and the consumer relations officers will negotiate with the retailer on your behalf, in order to reach an amicable resolution that hopefully meets your desired outcome. If the matter remains unresolved, you will then be advised on your next course of action, which may include going for mediation. As CASE’s involvement in this service is greater, and CASE will be representing you, you will first have to register as a CASE member, which comes with fees corresponding to your level of membership.
You can read up more about how you can lodge a complaint with CASE or how CASE can help you with your complaint on their website.
Lodging a complaint with CCCS
You can also lodge a complaint with CCCS. As mentioned earlier, CCCS is the administering agency for the CPFTA, with investigative and enforcement powers. Therefore, CCCS operates very differently from CASE, and is able to help in different ways. The main differences are as follows:
- Unlike CASE, CCCS does not assist you in your dispute with retailers nor in obtaining redress. The main function of CCCS is to ensure compliance with the CPFTA. Accordingly, CCCS will also not “represent” you in your dispute with the retailer.
- Unlike CASE, CCCS does not provide advice on the application of the law, nor does it provide general advice on hypothetical scenarios (e.g. what would happen if the retailer does X or does not do Y).
- CCCS’ powers are limited in terms of subject-matter, as it can only investigate matters which fall within the scope of the prohibitions under the CPFTA. For example, if your complaint is regarding active mobility devices and vehicles, you have to contact the Land Transport Authority. If your complaint is regarding food products, you will be redirected to the Singapore Food Agency. You may access the full list of subject-matter categories that the CCCS does not handle here.
That said, your complaint with CCCS is still valuable because it will allow CCCS to identify retailers engaging in unfair practices and put a stop to those practices so that other consumers will not be caught by the unfair practices in the same way.
You can file a complaint by sending the completed CCCS Complaint Form together with the relevant supporting documents (e.g. copies of the advertisements, photos of the products received, invoices) to the CCCS feedback email address. Alternatively, you may contact CCCS at their hotline. After receiving and processing your complaint, CCCS will contact you by email and/or telephone in five working days, and will keep you posted on the outcome of your complaint.
Suing the retailer
Lastly, you may also be considering pursuing legal action against the retailer (i.e. suing the retailer). Do note that litigation is typically an expensive option, and legal proceedings in Singapore may take anywhere from 12 to 24 months or more, depending on the issues in each case. Therefore, it may be good to consider carefully what your desired outcomes are, and whether there are alternative ways of achieving those same outcomes. It would also be useful to consult a lawyer for advice on the merits and strengths of your case.
Notwithstanding the above, there are two situations where commencing a lawsuit against the retailer may be preferred:
- If in the course of using the product that was falsely or misleadingly advertised, you were injured or hurt. For example, you purchased a dieting pill that was advertised as being “100% safe” or “scientifically-proven to be safe”, and after consuming it a few times, you suffer from gastro-intestinal pains, which a doctor has certified to be directly caused by the consumption of the pill. In such a situation, the harm that you have suffered is no longer just in the receipt of a defective product or an unsatisfactory product, but some form of personal injury. Hence, depending on the circumstances of the case, you may have a direct claim against the retailer.
- If the value of the purchase is extremely large (e.g. above the claim limit in the SCT), you may wish to void the contract on the grounds of misrepresentation. When you purchase a product/service, you are effectively entering into a contract with the retailer. Hence, if you were induced to enter into the contract by a misrepresentation that was made by the retailer, you may wish to commence a lawsuit in order to void the contract, and possibly even claim damages. To void a contract is equivalent to “undoing” the contract, and both the retailer and the consumer will be placed in a position as if they had not entered into the contract. This may involve the retailer being ordered to return you the amounts that you paid under the contract, upon your returning of the product to the retailer. You may read more about when you can void a contract for misrepresentation in our other article.
Ultimately, there is no one right answer when it comes to whether you should sue the retailer. It depends on the facts of your situation, and a variety of other factors and practical considerations.
You may read more about what some of these considerations are, as well as the steps to take when commencing legal action in our other article on civil litigation in Singapore.
What are Some Practical Steps That Consumers Can Take to Avoid Falling Victim to Misleading Claims
In order to avoid falling victim to misleading claims, you may wish to take the following precautions:
|Before making a purchase
|When making a purchase
|When receiving the goods
You should refer to the advisory by CASE and CCCS on online consumer transactions for more detailed advice to consumers on the precautions that you should adopt when shopping online.
Advertisements can be misleading in a number of ways, some of which are more obvious than others. As a discerning consumer, you should look out for advertisements that are inaccurate, ambiguous, exaggerated, or omit important details. If you have fallen prey to misleading advertising, you may wish to contact the retailer directly, or can choose to lodge complaints with the SCT, CASE, or CCCS. As a last resort, you may also want to commence legal proceedings against the retailer.
If you are considering commencing a lawsuit in Singapore, you may consult experienced litigation lawyers for assistance here. The lawyer will be able to provide you with further advice or information on the legal strengths and merits of your case. The lawyer will also be able to assist you with the preparation of your court papers if you decide to commence a claim.
- Price Transparency Guidelines by CCCS (With Examples)
- Your Consumer Rights in Singapore and How to Get Recourse
- Can silence amount to acceptance of a contract?
- Unfair Contract Terms Act: UCTA in Singapore
- When Can I Void a Contract For Misrepresentation?
- Making Lemon Law Claims for Defective Items in Singapore
- Hire-Purchase Agreement: Your Rights and Repossession of Goods in Singapore
- Is It Legal to Own Gold Bars or Bullions in Singapore?
- Victim of Hard Selling Sales Tactics in Singapore: What to Do
- Misled by an Advertisement? Here’s What You Can Do
- Missing Parcel? Here’s What You Can Do
- Delayed or Missing Baggage While Travelling? Here's What You Can Do
- What Can I Do If a Shop Vendor Sells Me a Grossly Overpriced Product?
- What Can You Do if You Were Sold a Defective Product in Singapore?
- Counterfeit Goods: Is it Illegal to Sell or Buy Them in Singapore?
- How to Get Back Your Money from a Company That’s Closing Down in Singapore
- Is Ticket Scalping Legal in Singapore? Risks Faced by Buyers/Sellers
- Am I liable for the charges if my credit card is stolen?
- I pawned a piece of jewellery to a pawnshop. What are my rights as a pawner?