Business
Australian Watchdog Sues Miyagi Over Alleged Deceptive Health Practices
The Australian Competition and Consumer Commission (ACCC) has taken Sydney-based health company Miyagi to court, alleging sales staff posed as medical professionals and misled Australians about their health risks to sell expensive treatment programs.
Australian consumer regulator, Australian Competition and Consumer Commission, has initiated legal proceedings against health and weight-loss company Miyagi Pty Ltd and its CEO Shane Da Costa in the Federal Court.
The Sydney-based company is accused of misleading customers into purchasing health programs for up to $7,500.
The Australian Competition and Consumer Commission (ACCC) states that the sales pitches included discussions of medical conditions and treatment plans, even when the salespeople involved had no formal medical qualifications.
Miyagi lured people through social media advertisements about free, no-obligation consultations, which then became sales pitches for six-to-18 month health programs.
Alleged misrepresentations in sales process
The ACCC is alleging that some salespeople insinuated they had qualifications to evaluate risk, giving an impression of expert health advice, which was not true. Consumers also alleged being hurried to sign contracts on the phone.
Program costs were reported from about $1,800 to $7,500.
Miyagi's contract clauses restricted cancellations and refunds, and the ACCC claims these infringed on Australian Consumer Law, potentially entitling some consumers to refunds.
The watchdog is seeking penalties and compensation orders, with possible disqualification for Mr. Da Costa from managing companies.
The company, established in 2015, previously reported about $28 million in revenue over five years and had expansion plans to the United States. Miyagi stated it collaborated with the ACCC investigation and would address the lawsuit in court.
This is the latest legal action against the health, wellness and weight-loss sector, where regulators are scrutinizing marketing tactics.
Source: Sydney Times
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