Federal Court orders massive penalty for false STA MultiFLEX product claims.
The Australian Competition and Consumer Commission has successfully prosecuted STA Travel, with the company admitting it made misleading representations in advertising for its MultiFLEX Pass product, claiming consumers who purchased the add-on would be able to change their flights without paying fees or charges.
ACCC Commissioner Sarah Court said consumers were misled into purchasing the $149 MultiFLEX Pass on the representation they would not have to pay anything further for date changes, “when in fact STA often charged consumers hundreds of dollars for changing their flights”.
In many cases STA’s charges were not reflective of additional fees imposed by the airline, with the ACCC noting that in almost a quarter of cases where a customer was charged extra by STA Travel, the amount was more than double the additional airfare and tax imposed by the airline.
Between 2015 and 2019 STA Travel estimates it sold about 16,000 MultiFLEX Passes per year.
The $14 million penalties “serve as a timely reminder to all travel businesses that they must not misrepresent the cost applicable when travel services are changed,” Court said.
More details in today’s issue of Travel Daily.