Harvey Norman’s highly publicised 60-month interest-free payment promotion has become the centre of a class action lawsuit after it was revealed that the deal included unexpected costs that were not disclosed to consumers.
The Australian retailer, in partnership with Latitude Finance, promoted the offer widely across media channels, promising a long-term, interest-free option to help customers pay for big-ticket items like electronics and furniture. However, as many customers discovered, the reality of the deal came with hidden fees and stringent conditions that were not clearly communicated.
According to Carter Capner Law, which is leading the class action, affected customers could be entitled to compensation ranging from $2,000 to $3,000. The compensation would cover fees such as credit card setup costs, monthly account fees, and potentially interest charges. The case has drawn attention to the broader issue of misleading marketing and poor consumer protection, highlighting the need for greater transparency in retail financing.
Misleading Terms and Hidden Fees
The 60-month interest-free promotion was marketed between January 2020 and August 2021, attracting many customers who were enticed by the idea of buying electronics or furniture without paying interest. However, the reality of the deal was far more complicated. Customers were required to sign up for a Latitude Finance credit card, which came with upfront costs and monthly maintenance fees. For instance, some customers reported paying setup fees of $25 and monthly charges that began at $5.95 but increased over time.
According to the Federal Court, these crucial details were omitted from the promotional materials, which were widely advertised on TV, radio, and in newspapers. One customer, who purchased a TV and PlayStation 4, ended up being hit with a $25 fee for the credit card and monthly charges that escalated over time.
Another shopper, who bought a laptop, ended up paying $550 in fees over five years. This lack of clarity around the actual costs of the deal led to a substantial financial burden on many shoppers who thought they were simply benefiting from an interest-free payment plan.
Legal Action and Potential Compensation
The Federal Court’s ruling has given rise to the class action lawsuit, with Carter Capner Law now calling for affected customers to come forward. Those who signed up for the Latitude GO Mastercard as part of the promotion are eligible to join the legal claim. The law firm has said that consumers could potentially be compensated for the full range of fees they were charged, including the credit card setup fee and any monthly maintenance fees.
The case stems from a broader investigation into the retailer’s advertising practices. In 2022, the Australian Securities and Investments Commission (ASIC) filed a case against both Latitude Finance and Harvey Norman, arguing that the retailers misled consumers about the true cost of the promotion. Despite an appeal by Harvey Norman and Latitude Finance, the Federal Court upheld its initial ruling, marking a significant victory for consumer rights.
The ongoing case serves as a reminder of the importance of clear, transparent marketing, particularly when it comes to financing options for consumers. It also raises questions about the practices of big retailers and whether they are doing enough to ensure that their customers fully understand the terms of the deals they sign up for.
