Tricked by fake reviews and false discounts? Meet the people who stop deceitful businesses

SINGAPORE: As consumer disputes continue to make headlines, Singapore’s national consumer protection watchdog is stepping up enforcement and taking more proactive steps to stop retailers’ unfair tactics.

“We are taking bolder steps. We want to go out there, we want to take action so that other people who are interested to do the same thing will be deterred,” chief executive Alvin Koh told CNA in an interview in September.

The Competition and Consumer Commission of Singapore (CCCS) took up the additional mandate of consumer protection in 2018.

In the six years since, that responsibility has grown to one-third of its workload, and the work is becoming more urgent. Almost 14,000 complaints were lodged with the Consumers Association of Singapore (CASE) in 2023.

A series of enforcement actions by CCCS this year implicated some well-known brands and shone a light on the range of deceitful tactics that sellers deploy against consumers.

In February, CCCS started investigating purifier company Sterra after receiving complaints about its advertisement that Singapore's tap water was not safe for drinking unless filtered by the company’s water purifiers.

The probe revealed that Sterra also used “strikethrough pricing” – offering false discounts where the supposed pre-discount prices were not genuine – and misled customers about where its purifiers were manufactured.

Sterra apologised in August and gave an undertaking that it would stop these unfair trade practices.

Then, in a first for Singapore, beauty chain Nail Palace and its director were punished for contempt of court after breaching court orders to declare and inform customers about their misleading representations on nail packages.

In June, CCCS also slapped Loft Home Furnishing with a warning over fake five-star reviews the furniture retailer published on its website.

MORE INVESTIGATORS, WORKING FASTER

These cases had been in the works for a while, Mr Koh said. But in announcing the outcomes, the deterrent effect this would have on other businesses was top of mind.

“The process of investigation obviously takes some time, but we have also made it a point … to get the right messages across to members of the public and to businesses who might be thinking of acting this way.”

Mr Koh, 49, is a career legal service officer whose last appointment before CCCS was at the Ministry of Manpower. He took over leadership of the commission in April.

Under his watch, “bolder steps” has also meant raising the headcount of CCCS’ staff who investigate cases by about 10 per cent.

There are about 50 such “case team members”, of whom 10 concentrate on consumer protection. Another 40 lawyers and economists may also participate in cases.

Mr Koh said the case teams have been keeping a closer eye on timelines as he spurs them on to bring cases to completion faster.

“They do see the satisfaction of the case moving out a lot more rapidly … they are feeling that renewed vigour, renewed energy,” he said.

After a strategic review, CCCS also established a small policy unit to drive more proactive, rather than reactive, work on consumer protection issues.

While Mr Koh expects to spend more time on consumer protection in the future, for now, two-thirds of CCCS’ workload continues to centre on competition matters.

One notable decision this year was its finding that Grab’s plan to acquire Trans-cab would significantly weaken rivals and could result in higher prices for drivers and passengers. Both firms decided not to proceed with the takeover.

CCCS’ overall mission is to ensure that “markets work well” by promoting fair competition and empowering consumers to make informed choices. In that sense, competition and consumer protection work hand-in-hand, said Mr Koh.

GIVING CONSUMERS CONFIDENCE

CNA previously reported on the plight of customers of errant interior design firm Formal Informal Practice, who faced difficulty claiming their court-ordered refunds when those orders could not be enforced.

In the case of Sterra, even after it apologised, some customers decided not to try seeking refunds as they felt dealing with the company was too troublesome.

Asked how people could be given more confidence that consumer protection measures will work for them, Mr Koh acknowledged the frustration that some face.

CCCS’ role in the consumer protection ecosystem is to carry out consistent and active enforcement to deter such cases from happening in the first place, he said. “We try to prevent unfair practices before they even impact the consumers.”

This is also what distinguishes CCCS from CASE, the other main consumer protection body in Singapore.

CCCS is a statutory board under the Ministry of Trade and Industry with legal powers to administer the Consumer Practices (Fair Trading) Act, while CASE is a non-profit organisation that is by law the first port of call for aggrieved consumers.

CCCS enforces by seeking court orders against businesses, in the form of declarations that a business is engaged in unfair practices and injunctions to stop such practices. CASE mediates and arrives at settlements between consumers and businesses.

According to Mr Koh, CCCS gets referrals from CASE, but also receives its own complaints. It also looks at consumer protection issues in jurisdictions like Australia, the United Kingdom and ASEAN.

The tipping point for an investigation is when a case is systemic or very egregious, said Mr Koh. CCCS also considers the impact on Singapore’s economy, with one measure being consumer complaint volumes.

In particular, the Sterra case showed that consumers can play a part in calling out questionable behaviour by businesses and warning fellow consumers too, he said.

“Consumers should be looking out for other consumers as well.”

While CCCS continues to monitor industries and take action, consumers also need to be vigilant and do their research before making purchasing decisions, he said.

GREENWASHING AND “DARK PATTERNS”

In the near future, CCCS has plans to act on greenwashing and “dark patterns” to strengthen consumer protection.

Greenwashing is when a business misleads consumers that their products or practices have greater environmental benefits than they actually do. Last year, for example, electronics retailer PRISM+ came under fire for an advertising claim that using its air conditioner was the “best tip” to “save Earth”.

Mr Koh pointed out that because Singapore imports most of what it consumes, it is challenging to implement advertising standards against greenwashing unless such standards can be harmonised globally.

But he said the commission is developing a set of guidelines “to help businesses make accurate and truthful claims about their products”. These are likely to open for public consultation within the year.

“We hope that these guidelines will help these businesses make green claims with more clarity and confidence,” he said.

Next year, “dark patterns” on e-commerce websites will also be an area of focus for CCCS’ new policy unit.

Dark patterns, also called deceptive patterns, refer to user interfaces that trick consumers into doing things they would otherwise not want to do.

These tricks can include hidden costs, automatic enrolment in paid subscriptions after a free trial, making it difficult to cancel subscriptions and disguised advertisements.

The term was coined in 2010 by UK-based user experience designer Dr Harry Brignull. Since then, dark patterns have been under growing scrutiny by regulators in the UK, United States and European Union.

Mr Koh likened this to a gym membership that can only be terminated by going to the business during office hours and talking to staff who will try to get the consumer to continue the membership.

“It shouldn’t be like that,” he said. “It’s all part of a whole pattern of behaviour, that people can actually design their websites to try and ensnare a consumer.”

Dark patterns may not be criminal in Singapore but they are possibly an unfair practice, and CCCS wants to teach consumers to be more discerning in the e-commerce space, he added.

“You shouldn’t be going around the internet feeling like you have to be ultra-attentive, otherwise you might end up paying for something that you didn’t want.”