Dell falls foul of Commerce Commission

Company settles claims of misrepresentation and breaching the Fair Trading Act

Dell has settled with the Commerce Commission and admitted breaches of the fair trading act involving misrepresentation.

Complaints from the public included issues relating to computer monitors and misrepresentations about the availability of computers, the Commerce Commission said in a statement today.

"In 2006, Dell New Zealand marketed its 2007WFP computer monitors as suitable for computer gaming and high end graphics, when they in fact had an inherent issue known as 'colour banding', where colours are distorted in computer graphics," the statement says.

"Despite being aware there was an issue with the monitors, for a six week period Dell New Zealand not only failed to notify consumers but replaced returned monitors with monitors that had the same banding issues."

Dell has now eliminated the issue and any customers who believe that their Dell monitor has issues with colour banding are encouraged to contact Dell on 0800 33 55 41.

Dell says the total number of complaints made to the Commission was six.

"Customers are our top priority at Dell," the company's Australia and New Zealand corporate communications officer Marty Filipowski said in a statement. "While even one dissatisfied customer is too many, the cases referred to in the settlement with the New Zealand Commerce Commission relate to a very small number of Dell’s consumer transactions in New Zealand. 

"We remain committed to providing the highest quality products — all the time. We are also committed to providing a positive experience to all of our customers every day, including publishing accurate advertising." 

The acting director of the Commerce Commission's Fair Trading Branch, Stuart Wallace, says businesses need to ensure that known problems are fixed before goods are distributed.

"Once a business becomes aware of an issue with one of its products, it should make every effort not only to rectify the problem, but also to advise its customers."

Dell was also pinged for claiming in print and television advertising that its products could not be purchased in shops, when in fact they were available at The Warehouse. The company also admitted breaching the Fair Trading Act in relation to offering a 'free' upgrade to Windows Vista when a $40 delivery fee was required to obtain the upgrade, and promoting an online competition to win a laptop that was only available to Australian customers.

Dell has agreed in its settlement to ensure future advertising sets out in unambiguous terms any existing faults with products, the terms and conditions for any of its competitions and availability of products.

Wallace says the behaviour demonstrated a serious breakdown in Dell's internal procedures and the company has agreed to undertake a comprehensive review of its compliance programmes as a result.

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