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Surge in Livestreaming e-Commerce and Online Clearance Sales Traps Amid the Pandemic No Recourse for Payments Made to Personal Bank Accounts

  • 2022.03.15

Under the pandemic, the public has become accustomed to “shopping from home”, fuelling the prevalence of online shopping under the new normal. Many online shopping platforms have grasped the opportunity to create viral buying trends through “livestreaming e-commerce", spurring on consumers to place orders before they had time to fully understand the product details. Online shopping platforms and social media sales pages have sprung up, exploiting consumers’ sentiment of FOMO (fear of missing out) and desire for bargains by touting selling points such as “best deal ever”, “rock bottom price”, “clearance sale”, etc. Some even require buyers to deposit the payment directly into personal bank accounts but disappear after receiving the payment, making it impossible for consumers to seek redress. The Consumer Council is highly concerned about the rising number of complaints involving online shopping during the pandemic, with some cases even suspected to be frauds. Consumers are reminded to be vigilant and rational when shopping online; to understand the quality of the products, the terms of sale, the refund and return arrangements; and to select more robust and reputable online shopping platforms while refraining from impulse buying. The Council points out that while the new normal has brought more business opportunities to the online shopping industry, online stores and sales platforms are urged to establish solid reputation through honest practices, which not only helps build business development but also protects consumer rights, thus achieving a win-win situation.

Case 1: Quality of Jewellery Did Not Meet Expectations Due to Use of Filter During Livestreaming; Blame-shifting Between Shopping Platform and Trader

The complainant was unable to personally come to Hong Kong to shop during the pandemic. She watched a livestream sales session of jewellery hosted by the counter staff of Company A. The host repeatedly mentioned that the livestream was shot with the actual products without applying any filter effect. The complainant favoured a yellow jade pendant worth around $5,200 after discount, and another green petal pendant worth around $3,500 after discount. She immediately clicked to buy and paid. However, after receiving the goods, the complainant found that the green petal pendant was very light and small, while the colour of the yellow jade pendant was duller than that in the livestream. The complainant contacted the shopping platform, and the staff admitted to have used a beauty filter during the livestream after being queried repeatedly. The complainant then complained to Company A, and received a reply that the goods sold during the livestream were discounted items with no return or exchange. The complainant thus lodged a complaint with the Council.

The Council contacted the shopping platform and Company A respectively. Company A reiterated that the complainant purchased the jewellery through the shopping platform with no direct transaction with Company A, while it was also clearly stated during the livestream that there would be no return or exchange of the goods. Company A subsequently agreed to handle the case with discretion and arranged a cash refund of $8,700 as a gesture of goodwill. The case was thus successfully resolved.

Case 2: Camera Purchased on Clearance by “Cash on Delivery” Not Meeting Sales Claims; Courier Company Not Responsible for Disputes Between the Buyer and Seller

The complainant viewed an online post selling German cameras and visited the sales page via the provided link. The webpage claimed to be selling a clearance stock of around 300 German-branded cameras, at $498 each only. The complainant clicked to buy and selected the pay-on-delivery option. When the courier delivered the goods a few days later, the complainant requested to open the box for inspection first, but was declined by the courier who urged the complainant to sign the delivery note and make the payment, and then left. After opening the box, the complainant found that the camera did not have any trademark, packaging box, user manual or warranty card. He immediately went to the branch of Delivery Company B to negotiate, demanding to stop the payment for the goods from passing to the seller, but the staff only promised to return the goods to the seller’s address in an industrial building as stated on the shipment form. The complainant also tried searching for the seller at the shipping address, but the building management office stated that the relevant seller did not exist. The complainant thus sought help from the Council.

Delivery Company B replied to the Council in writing, saying that according to their record, the complainant's returned goods had been delivered to the relevant shipping address in the industrial building, and that the company would not handle transactional issues between the customer and the sender, emphasising that issues with the goods had nothing to do with the delivery company. The Council attempted to contact the seller via the email address on the website, but there was no reply. The complainant understood that it was difficult to pursue further.

Case 3: "Rock Bottom Prices” and “Limited Stock” Advertised on Social Media Platform to Drive Purchase; Unable to Seek Recourse After Payment

The complainant saw a social media post selling Korean smokeless grills, originally priced at $988 but now at a “rock bottom price” of $499 with a quota of 50 units. The complainant sent a message immediately, and the page owner promptly replied that the product was licensed and came with a one-year warranty. While the complainant was still considering, the page owner sent another message claiming that there were only 5 units left and offered a further reduction of $100. The complainant immediately agreed to the purchase and settled the payment electronically according to the instructions. The page owner replied that a next-day delivery would be arranged. However, the complainant did not receive any further notice thereafter, and not only did the page owner not respond to her messages, the page even disappeared after two days. The complainant thus turned to the Council for help.

As the payment for the goods was made to a personal bank account without specific business information of the seller, it was difficult for the Council to conciliate. The complainant claimed that as the webpage adopted the brand name of the kitchenware as the profile picture, she was misled into thinking that it was an official account. She knew that it was difficult to seek redress, but having found that many consumers had also fallen prey to such malpractice, she believed it was necessary to alert the Council to such kind of consumer trap.

The Council reminds consumers to ascertain whether the payee is an individual or a company account before making a payment. In the absence of specific business information, they should avoid making payment to personal bank accounts or have the payment collected by the delivery company. Also, the background and business information of online sellers should be verified through different channels. Websites or pages may not be reliable if they only provide a mobile phone number or are only reachable through mobile phone messages. Consumers should be more cautious if the page is found to be set up very recently and/or the post content is monotonous. Under the pandemic, the Council urges consumers not only to step up anti-epidemic measures and take good care of their health, but also to maintain a positive shopping mentality, refrain from impulse buying, and increase vigilance to avoid falling into online sales traps.

 

 

Download the article (Chinese only):  https://ccchoice.org/545complaint

 

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