Mosaic Brands Limited, one of Australia’s largest specialty fashion retailer groups, has been hit with more than $265,000 in penalties by regulator ACCC for “alleged false or misleading representations”.
The penalties come following infringement notices issued to Mosaic Brands, who own brands Noni B, Ezibuy and Rivers among others, for a face mask advertised on its Autograph Fashion brand website and a hot water bottle advertised on its Katies brand website.
Mosaic Brands, the ACCC allege, advertised a KN95 face mask for sale on its website in August 2021 intending to reach consumers grappling with then high levels of concern about the spread of COVID-19 variant Omicron. Described on its website as being approved by the United States’ Food and Drug Administration (FDA) and Europe’s Conformitè Europëenne (CE), the ACCC allege that these claims met the criteria of false representations given the product had been approved by neither.
In the same month, Mosaic Brands advertised for sale a hot water bottle on the website for its Katies brand with the claim that it was “ACCC approved” when, as the ACCC state, the regulator does not make such endorsements of products.
“We were very concerned about the type of representations being made by Mosaic Brands,” ACCC Commissioner Liza Carver said in a statement, “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.”
“These penalties are a warning to all businesses that making false or misleading representations about government approval for their products can lead to ACCC enforcement action, with serious consequences including penalties.”
The latest infringements and penalties come following another series of penalties issued to Mosaic Brands in May of last year, with the retailer group then admitting to making false or misleading claims about hand sanitiser and face mask products during the COVID-19 pandemic. The penalties for these infringements had totalled $630,000.
It has been a particularly challenging year for Mosaic Brands, which reported considerable declines in group revenue and EBITDA for the FY22 period, despite a modest seven percent growth in revenue from the group’s online sales. In anticipation of the expected fiscal year losses, the share price for Mosaic Brands saw a 63 percent nosedive in the month of May.
Share prices for the retailer group now sit at 28 cents per share as of time of writing, up from its lowest point in 2022 of 17 cents in mid-July.
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