Reviews pre-written by companies and emailed to customers to endorse as a testimonial have cost online tradie marketplace Service Seeking $600,000 following legal action by the competition watchdog the Australian Competition and Consumer Commission (ACCC).
The Federal Court hit Service Seeking Pty Ltd with $600,000 in penalties for making false or misleading representations regarding business reviews – some 17,000 of them between July 2016 and November 2018 – published automatically, without customer input, on the platform.
Service Seeking is an online platform for people to seek quotes for jobs, such as gardening, building or cleaning.
The ACCC launched legal action over Service Seeking’s “Fast Feedback” feature, which allowed businesses to draft their own reviews using a template and choose a star rating for their service after completing a job. This draft review was emailed to the customers, but if they didn’t respond with a self-written review within three days, the draft review was automatically published on the company’s profile on Service Seeking. More than 21,000 review were made this way.
Service Seeking admitted its liability publishing reviews that falsely represented that they were from customers.
Federal Court judge Justice Darren Jackson said in his judgment that Service Seeking had “engaged in a systematic course of conduct for the self-interested purpose of increasing the attractiveness of its website to businesses and customers” and “must have known” it would lead to misleading conduct.
“This was an abuse of the trust that customers can be inferred to have placed in the site, the existence of which can be inferred from the number of active customers who posted one or more jobs,” he said.
ACCC Deputy Chair Delia Rickard said the reviews created a false impression of the number of favourable reviews and star ratings.
“Consumers are increasingly relying on online reviews as a way of making informed purchasing decisions. Deceiving them about the authenticity of the reviews in my view is showing contempt for consumers,” she said.
The Court also made orders for injunctions, corrective notices and the implementation of a compliance program.
In response to the decision, Seeking Solutions CEO and founder Jeremy Levitt told Startup Daily that “The case related to a small proportion of reviews published between 2016 and 2018 after which the Fast Feedback feature was removed from the site.”
At the time the ACCC began legal action in December 2018, Service Seeking had more than 1.5 million customer accounts and around 170,000 business accounts.
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