Office of Fair Trading
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OFT stops misleading psychic adverts

OFT stops misleading psychic adverts

OFFICE OF FAIR TRADING News Release (130/08) issued by COI News Distribution Service. 13 November 2008

A Dutch-based company has been stopped from publishing misleading 'psychic' advertisements in the UK, following action by the OFT.

Sky Connection BV, a Dutch company, placed advertisements in a number of national newspapers and magazines claiming that 'experts' at an organisation named as the 'Institute of Wellbeing' were launching a major appeal to identify individuals born between 1932 and 1969. The adverts claimed that the experts believed that many people born between these dates could enjoy 'unbelievable good fortune' in the coming weeks.

Consumers were asked to contact the experts by completing and returning a coupon to receive a free 'forecast' detailing a number of predictions. At least 30,000 consumers responded to the advertisements and were then sent a number of highly misleading follow-up mailings offering various 'psychic' products.

At least 6,700 orders were placed for the advertised products and services, which cost between £20 and £40. The products offered included a 'personal positive wave harmoniser' which it was claimed was designed to alleviate bad luck associated with negative waves in the consumer's home, and 'personal lottery numbers to play'. The mailings were personalised to give the impression that each recipient was known to the sender but were in fact otherwise identical mass mailings.

The OFT approached Sky Connection BV contending numerous breaches of consumer protection law and requesting substantiation of the claims.

Having provided no evidence to substantiate the existence of the so called 'Institute of Wellbeing' or any of the other claims, Sky Connection BV, its UK parent company Priority Mail Ltd, and their common director Mr Gerard du Passage each gave undertakings to the OFT, under the Enterprise Act 2002, that they would stop publishing the offending advertisements and no longer engage in unfair commercial practices.

If the undertakings are breached, the OFT can seek a court injunction in the UK and refer Sky Connection BV to its Dutch counterparts requesting action under the EU Consumer Protection Cooperation Regulation.

The OFT will be writing to all consumers who ordered products from Sky Connection BV advising them about its action and offering advice about bogus psychic mailings more generally.

Mike Haley, OFT Director of Consumer Protection, said:

'These advertisements made highly misleading claims promising consumers luck, happiness and money if they bought the products offered. The OFT will continue to take action against marketers who seek to exploit vulnerable and superstitious consumers.'

The OFT estimates that 170,000 UK consumers fall victim to deceptive psychic mailings every year collectively losing an estimated £40 million annually. Consumers who are unsure whether an offer is genuine should contact Consumer Direct for clear, practical advice on 08454 04 05 06 or visit the Consumer Direct website at http://www.consumerdirect.gov.uk.

NOTES

1. Sky Connection BV has a registered office of Modmstraat 20-1, 1033 RW Amsterdam, Netherlands. Priority Mail Ltd has a registered office of 37 Greenhill Street, Stratford-upon-avon, Warwickshire, CV37 6LE.

2. Undertakings under Part 8 of the Enterprise Act 2002 were given by Sky Connection BV, Priority Mail Ltd and their common director Gerard du Passage, on 13 October 2008. The undertakings relate to contended breaches of the Consumer Protection from Unfair Trading Regulations 2008.

3. Sky Connection BV, trading as 'The Institute of Wellbeing' is not connected in any way to the UK company, Institute of Wellbeing Limited which has a registered office of 113A Anerley Road, Anerley, London, SE20 8AJ.

4. The Consumer Protection from Unfair Trading Regulations ('CPRs'), which implement an EC Directive, came in to force on 26 May 2008. The CPRs prohibit unfair commercial practices which distort consumers' decisions. They introduce a general duty not to trade unfairly on businesses dealing with consumers. They prohibit misleading consumers by action or omission. They also contain prohibitions against aggressive practices, as well as 31 specific practices that are always considered unfair.

5. The CPRs are enforceable by the OFT and other designated enforcers through both the criminal and civil courts. Breaches of the CPRs also constitute 'Community infringements' under the Enterprise Act 2002. Under this Act, the OFT can apply to the courts for an injunction ordering businesses to comply with the law in future. It may also accept undertakings from those involved in lieu of action.

6. Consumer Direct is a telephone and online consumer advice service funded by government and managed by the Office of Fair Trading. It offers clear, practical and impartial advice and information about consumer rights.


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