Harvey Norman and Latitude Financial fined for misleading ads campaign
Consensus Summary
Harvey Norman and Latitude Financial were fined a combined $55 million ($35 million and $20 million, respectively) for a misleading advertising campaign that ran from January 2020 to August 2021. The ads promoted a 60-month interest-free payment scheme that required customers to take out a credit card, including hidden fees. The Federal Court ruled in October 2024 that the companies breached consumer law, and the decision was upheld on appeal in September last year. Both companies were ordered to publish corrected advertising for 90 days. The ABC notes additional penalties for Latitude, including $3.96 million for spam violations, while the SMH highlights Gerry Harvey's critical remarks about the legal system as a factor in the higher penalty for Harvey Norman. ASIC described the penalties as a warning to the market about consumer marketing integrity.
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Key details reported by multiple sources:
- Harvey Norman and Latitude Financial were fined a combined $55 million ($35 million for Harvey Norman, $20 million for Latitude) for misleading advertising between January 2020 and August 2021.
- The misleading ads promoted a 60-month interest-free payment scheme that required customers to take out a credit card, including fees like monthly account service fees and establishment fees (up to March 16, 2021).
- Customers who signed up for a Latitude GO Mastercard between March 16 and August 11, 2021, and paid off their purchases during that time were liable to pay a minimum of $537 in additional fees.
- Both companies were ordered to publish corrected advertising on their websites for 90 days.
- The Federal Court ruled in October 2024 that Harvey Norman and Latitude breached consumer law by misleading customers, and the ruling was upheld on appeal in September last year.
- Latitude Financial was also ordered to pay $3.96 million for breaking spam laws more than 2.7 million times between March 2024 and April 2025.
- ASIC chair Sarah Court described the penalties as a 'strong warning to the market' about integrity in consumer marketing.
Points of Difference
Details reported by only one source:
- Harvey Norman accrued at least $16.2 million in anticipation of the penalty and expected an additional financial hit in the financial year due to the penalty.
- Latitude Financial was ordered to pay an additional $1.5 million in fines for spam breaches in 2022.
- Almost 345,000 spam messages sent by Latitude lacked a working unsubscribe function.
- Harvey Norman issued an apology to customers, stating it 'did not intend to engage in false, misleading or deceptive conduct' but apologized unreservedly.
- Latitude Financial's general counsel issued an apology to customers on behalf of the company.
- Justice Michael O'Bryan cited Gerry Harvey's comments calling the legal system 'f---ed' as a factor in increasing Harvey Norman's penalty.
- Harvey Norman's leadership refused to offer a personal apology, while Latitude had apologized to customers.
- ASIC estimated the incremental revenue earned by each party through the misleading ads was about $5 million.
- Harvey Norman was denied a five-year injunction restraining similar ads, which ASIC had sought.
- Gerry Harvey downplayed his involvement, stating he was now a farmer and not actively involved in the company.
Contradictions
Conflicting information between sources:
- The ABC states Latitude Financial was ordered to pay $20 million for the misleading ads, while the SMH does not explicitly mention this figure but confirms the $20 million penalty in the context of the ruling.
- The ABC mentions a $537 minimum fee for customers who signed up between March 16 and August 11, 2021, but the SMH does not reference this specific fee amount.
Source Articles
Harvey Norman and Latitude face $55m penalty for misleading ad campaign
The two businesses misled customers into taking out credit cards and paying additional fees in a 60-month interest-free payment scheme, the corporate regulator says.
Gerry Harvey branded the legal system unjust. It has come back to bite him
The Federal Court has hit Harvey Norman with a $35 million penalty for running misleading ads – much more than the $20 million slapped on its partner company.