Educational institutions were sent a clear and strong message today: you must be vigilant in the accuracy of promotional material relating to courses.
The warning comes from Judge Murray Abbott, who today fined Christchurch based Design and Arts College of New Zealand Limited $10,000 in the Christchurch District Court for four breaches of the Fair Trading Act. This case is the first of three Commerce Commission prosecutions against private training establishments.
In sentencing Design and Arts, Judge Abbott said: "The penalty must send a message to the education and training industry in general to ensure that representations made are accurate. The penalty must not be viewed as a licence to cut corners or take shortcuts. Educational institutions must be vigilant in ensuring that material promoting courses is accurate."
Speaking of the prejudice that resulted from misleading claims, Judge Abbott said: "I regard this as the most significant factor in the present context. Clarification after a course has started is of little significance in the mitigation context as a student may have committed him or herself to the course, paid fees and made plans for the year ahead based on the earlier representation. Students are put in an invidious position of either continuing or cutting their losses."
Design and Arts College pleaded guilty to four charges of breaching the Act by claiming its course in multi media design and production was for a national diploma qualification when it was only a certificate course. The claims about the 37 week course were made in The Christchurch Press newspaper advertising and a prospectus supplied to prospective students.
Judge Abbott added: "In my view there was a significant degree of carelessness, in particular in continuing to use the prospectus, similarily in respect of the two newspaper advertisements as an earlier copy was used without it being checked."
The Commission's other cases against private training establishments are against Kaikohe based Planet Career Training Limited for alleged misleading claims and undisclosed additional costs regarding computers and printers that students were to receive on completion of a computer course.
The third is against another Christchurch based company, Careerlink, which faces seven charges under section 11 of the Fair Trading Act concerning representations made in newspaper advertising for educational courses it offered in 2000. Careerlink is defending the charges and the case is scheduled for a three day hearing in the Christchurch District Court commencing on the 4 June.
The Commission is unable to comment on the details of the two remaining cases as the companies involved are yet to have their cases heard by the courts, but Commerce Commission Chair John Belgrave said the Commission is concerned at the high number of enquiries it receives about education and is taking a closer look at the sector.
"Last year, the Commission received over 120 complaints and enquiries regarding education," said Mr Belgrave.
He added that the three cases demonstrate that if the Commission believes a company has crossed the line it will prosecute. The Commission will continue to monitor the education sector and will take action if contraventions are found.
Mr Belgrave also urges students considering courses to ask lots of questions, and find out as much information as possible about the status of the qualifications on offer and the value of the equipment to be provided.
"That is, be very clear about what you are paying for, and what you will be receiving."
Media contact: Director of Fair Trading Act Deb Battell
Phone work (04) 498 0908, cellphone 025 208 0841
Communications Manager Jackie Maitland
Phone work (04) 498 0920, cellphone (025) 249 3407
