ACCC investigates Crazy John's for alleged false advertising

Only two months after the death of its founding member John Ilhan, mobile phone chain Crazy John has found itself in hot water, with the ACCC over misleading advertising.

The Australian Competition and Consumer Commission (ACCC) has instituted proceedings in the Federal Court against the retailer for alleged contraventions of the Trade Practices Act 1974 in relation to the promotion of some of its mobile phone plans.

The ACCC alleges that Mobileworld Operating Pty Ltd (trading as Crazy John's) engaged in misleading or deceptive conduct by advertising handsets on its Crazy Phone Plans as 'FREE' or for '$0', when in fact consumers are required to pay for the handsets through higher call rates than those available on comparable plans which do not include a handset.

The ACCC alleges that these representations contravene sections 52 and 53 of the TPA. The ACCC is seeking a range of remedies including declarations regarding the alleged contravening conduct and corrective advertising.

The government body said proceedings utilise the Fast Track List in the Victorian registry of the Federal Court, which is intended to streamline court procedures in matters of this nature, thereby reducing the time and cost of litigation.

A scheduling conference has been set down for 29 February.

Crazy John's is yet to respond.