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Kogan Under Investigation Over Claims It Raised Prices Before Offering 'False' Discounts

Online retailer Kogan has found itself in court accused of misleading customers with a 'false' end of financial year discount promotion. 

The Australian Competition and Consumer Commission (ACCC) has launched legal action, alleging Kogan lifted prices on more than 600 products before offering a "10 percent discount" online in June 2018.

Kogan is defending the claims, and denies the allegations.

ACCC Commissioner Sarah Court said the retailer's advertisements could have misled customers into thinking they were getting products below usual price.

"In fact, Kogan had inflated product prices which we say created a false impression of the effective discount,” she said.

The consumer watchdog alleges prices increased by at least 10 percent in many cases.

An example of Kogan's web promotion. PHOTO: ACCC

The promotion ran between June 27 and 30 last year, during which time Kogan promoted a 'taxtime' discount code via email and text messages, using statements such as "48 hours left" and "ends midnight tonight".

The ACCC said this gave consumers the impression they had limited time to purchase at a "discounted" price.

Shortly after the promotion ended, Kogan reduced the prices on affected products -- many back to their pre-promotion price.

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The ACCC has commenced Federal Court proceedings, which Kogan said it would defend. It denies the allegations.

"Kogan.com's marketing collateral in connection with the promotion was carefully considered and was drafted specifically to avoid the type of confusion alleged by the ACCC," a Kogan spokesperson said in a statement.

The retailer said it had cooperated fully with the ACCC.

Featured image: ACCC