One of Australia’s largest fashion conglomerates has been handed a $266,000 fine for misleading claims about face masks and hot water bottles during COVID.
Mosaic Brands – owner of Katies, Millers, Rivers, Noni B, Rockmans, W.Lane and Autograph – has paid the fines after an investigation by the consumer watchdog.
It’s the second time in as many years the retail giant has faced such penalties, despite it signing a court-enforceable undertaking promising to clean up its act.
The Australian Competition and Consumer Commission alleged that the company falsely claimed last August that KN95 face masks sold by Autograph were approved by US and European authorities or standards (the FDA and CE).
It also said Katies had claimed its McGloin-branded hot water bottles were “ACCC approved”, despite the fact that the regulator does not endorse products.
“We were very concerned about the type of representations being made by Mosaic Brands,” ACCC Commissioner Liza Carver said in a statement on Thursday.
“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.”
Its not the first time Mosaic has been slapped with penalties for misleading claims about health products during COVID. It was earlier fined $630,000 for making false statements about hand sanitiser and kids face masks sold in early 2020.
At the time, Mosaic signed a three-year enforceable undertaking with the ACCC, which included implementing a “consumer law compliance program” and saying it would “properly substantiate” claims with respect to “health essentials products”.
The ACCC did not immediately comment on whether the latest fines mean this agreement was breached, even though the conduct occurred months after the undertaking was signed.
When contacted by TND, an ACCC spokesperson said it won’t take further action in relation to the latest alleged contraventions of Australian Consumer Law.
“The court enforceable undertaking provided to the ACCC by Mosaic Brands requires the company to implement a consumer law compliance program, which includes development of an effective complaints handling system, committing to an internal compliance policy and training staff on compliance with the consumer law,” an ACCC spokesperson said in a statement.
“Additionally, Mosaic Brands is required to appoint an independent party to conduct an annual review of its compliance with the program, and to report any material failures identified by the reviewer to both its board and to the ACCC.”
“The ACCC actively monitors compliance of court enforceable undertakings.”
Mosaic, which runs about 1100 brick-and-mortar fashion stores Australia-wide, posted $619 million in sales across its group for the 2022 financial year.
The fines issued by the ACCC since 2021 equate to 0.14 per cent of these sales.
Mosaic Brands has been contacted for comment.
