Dell fined $6.5M after admitting it made overpriced monitors look discounted
Dell fined $6.5M after admitting it made overpriced monitors look discounted
Dell Australia is paying for something many of its peers are guilty of.
Dell's Australia arm has been slapped with a $10 million AUD (about $6.49 million) fine for "making false and misleading representations on its website about discount prices for add-on computer monitors," the Australian Competition & Consumer Commission (ACCC) announced today. The Australian regulator said the company sold 5,300 monitors this way.
A for-profit company used a tactic to increase its profits. Shocking.
Honest question: Will the ACCC share the fine with customers that Dell ripped off?
No, but those users are probably free to launch a class action lawsuit themselves, and official government decisions make for good evidence.
The fine usually goes back into the operational expenses of trying to keep up with the flood of complaints about shitty companies the ACCC receives everyday.
Edited to add: IANAL and Dell have already been ordered to offer refunds in addition to the fine so a class action might not apply here. But it's still something.
@Madison_rogue I've heard there's some debate over how much the refund should be for. The obvious complication is that, the actual price they paid matches what they expected to pay, the issue being that the list price was faked. I think the refund should take the advertised discount (60% off) and apply it to the real lost price, and refund them the difference. That makes the consumer whole, providing them the discount they were told they were receiving.
Then, the fine they receive on top of that should be double. Send a strong message that if you defraud consumers, it's going to hurt. If all 5300 monitors cost the example price of $990, then the refund amount would be $600 each, for a total of 3.15 million in refunds and 6.3 million in fines. Sounds like this might be exactly what regulators had in mind since my number came pretty close to theirs. Dell is extremely fortunate they sold so few monitors. Because the advertised discount was so high, the fines alone appear to more than wipe out the revenue they made from these monitors, and whatever refunds they have to pay out on top of that puts them even further in the hole. Crime doesn't always pay.
So... Pocket change then.
They were fined $1,900 per monitor they sold (at a price of $990) this way.
So the fine was double the price.
That does not sound like pocket change to me.
What do you think would be a reasonable fine?
Dell's 2022 revenue was $102 billion. $6.5 million is 0.006% of their overall revenue.
To put in perspective, were I to make $75,000 annual income, 0.006% of that would be equivalent to $4.50.
EDIT
Math is hard, yo.
Cost of doing business...
The cost was $1,900 per monitor they sold...