ANZ Bank was fined $16,000 today in the Wellington District Court on three charges relating to its "Yes Mortgage" marketing campaign run last year.
ANZ pleaded guilty last month when charges were brought by the Commerce Commission.
Commission General Manager John Feil said the fine gave two messages to businesses. One is a warning to all advertisers about small print and special conditions. The other is that ignoring Commission warnings can land them in court.
"The impression created by the large text, pictures, colour, music and all the other elements used in advertising is all important," Mr Feil said.
"If that impression is misleading, then small print will not stop the ad breaching the Fair Trading Act. It cannot be used to contradict the impression made by the ad.
"In addition, any important conditions that may apply must be shown clearly. Flashing them
on the screen so quickly that they cannot be read will not stop the ad being misleading."
ANZ had pleaded guilty to making misleading claims in a newspaper advertisement about the cost of a Yes Mortgage approval fees, and in two widely broadcast television commercials which included special conditions that were impossible to read.
The Commission had previously warned the ANZ about its newspaper advertisement, but it used it again and also broadcast television commercials.
The newspaper advertisements read "We've halved the standard maximum approval fee to just $500 (although you may pay less)." But fine print said the maximum fee could be up to $1,000 unless the customer moved their banking to the ANZ.
Conditions on the television advertisements included fees of up to $1,000, mortgage insurance being compulsory for some customers and one offer being available only to customers with certain kinds of mortgage.
"The ANZ has admitted these ads were misleading. In one, it tried to use fine print to contradict a message clearly spelled out in large text. In the other cases, important conditions were on the screen for such a short time that they could not even be read," Mr Feil said.
"We advised ANZ, it ignored our warning, and now it has paid the price."
Media contact: Communications Officer Vincent Cholewa
