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Harry Triguboff’s Meriton has been fined $3 million for manipulating reviews on the online travel comparison website TripAdvisor.
The penalty follows a first-of-its-kind case pursued by the Australian Competition and Consumer Commission.
The Federal Court handed Meriton the penalty after finding the property giant had prevented customers from leaving potentially negative reviews on TripAdvisor by "masking" guests email addresses.
TripAdvisor, arguably one of the world's most popular travel comparison websites, allows users can rate accommodation and restaurants out of five and publish their feedback.
The process of "masking" involved Meriton's staff inserting additional letters "MSA" (Meriton Serviced Apartments) in front of guests' email addresses if they had complained, or were likely to leave a negative review.
Approximatley 14,000 email addresses were masked over a nine month period in 2015 across 13 of Meriton's serviced properties.
The Commission pushed for a $20 million fine, accusing Meriton of breaching Australian Consumer Law and and "engaging in misleading and deceptive conduct".
Meriton argued a fine between $330,000 and $440,000 was more appropriate.
Meriton has been banned for three years from selecting, filtering or limiting guest email addresses supplied to TripAdvisor without the person's consent.
“People often make purchasing decisions for accommodation based on the rankings and reviews they read on third party sites like TripAdvisor,” ACCC commissioner Sarah Court said.
“Manipulating these reviews is misleading to potential customers, who deserve the full picture when making a booking decision.”
Court said Meriton's management were complicit and directed staff to engage in "masking".
“Meriton’s management directed staff to engage in ‘masking’ to stop potentially negative reviews from appearing on TripAdvisor,” Court said.
“This gave the impression Meriton accommodation was of a higher standard than otherwise may have been the case.”
The court has ordered Meriton to establish a compliance and education program for staff to adhere to provisions of the Australian Consumer Law.
“This case sends a strong message that businesses can expect ACCC enforcement action if they’re caught manipulating feedback on third party review websites,” Court said.
Meriton has been contacted for comment.
