Christmas hamper company Chrisco Hampers Ltd was fined $175,000 after pleading guilty to breaching the Fair Trading Act by misleading customers about their cancellation rights under the Layby Sales Act.
The Layby Sales Act gives customers the right to cancel at any time until the last payment and governs what a seller can charge a customer when they cancel.
Between 2008 and 2010, Chrisco operated a cancellation policy where customers were charged 20 per cent of payments already made if they cancelled up to 90 days prior to the final payment date.
A Consumer NZ survey last March found that the items in Chrisco's "traditional" hamper could be bought online from Woolworths for $327.84 - about $83 less than Chrisco's price of $10.53 a week for 39 weeks ($410.67).
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