The ANZ Bank today pleaded guilty to three charges relating to its "Yes Mortgages" marketing campaign run last year.
Sentencing will be on February 22 in the Wellington District Court. The ANZ was prosecuted by the Commerce Commission.
Commission General Manager John Feil said these convictions are timely warnings to all advertisers about small print.
"The message people see in large print must not be contradicted by the small print," Mr Feil said. "And special conditions screened as part of a television advertisement need to be both big enough and on for long enough for people to read them.
"If there are important conditions, then they should be shown clearly in the advertisement," he said.
ANZ 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 ad," Mr Feil said. "Not only did the ANZ publish the ad again, but it 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.
One of the television commercials said customers could "stop repayments for three months" and the other said the ANZ was offering "one month interest free".
The conditions included fees of up to $1,000, mortgage insurance being compulsory for some customers and the stop repayments offer being available only to customers with certain kinds of mortgage.
Mr Feil said that under the Fair Trading Act advertisers must consider the overall impression their advertisements create.
"Fine print may not be enough to prevent a breach of the Act," he said. "In the case of the newspaper ad, the Court said the fine print was not enough to correct the false representation made in large print, therefore the ad breached the Act.
"In the television commercials the fine print did not correct the overall impression because it was on the screen for such a short time that it could not even be read."
Mr Feil said these three convictions reinforce the Commission's view that fine print cannot be used to change a claim made in large print nor to disguise information important to people's buying decisions.
Media contact: Communications Officer, Vincent Cholewa
