Consumer Advisory - Consumers have the right to say “no” when faced with pressure selling tactics
 

The Consumers Association of Singapore (CASE) would like to warn consumers to be wary of pressure sales tactics that are commonly encountered in the slimming, beauty and hair industries. Consumers should be aware that they always have the right to say “no” to such tactics and can simply walk away if they feel uncomfortable.

The use of high pressure sales tactics has been a recurring problem in the slimming, beauty and hair industries for many years. The percentage of consumer complaints involving sales tactics for these industries is significantly higher as compared with the other industries, which generally record less than 5% of sales tactics complaints. In 2017, 44% of complaints for the slimming industry, 16% of complaints for the hair industry and 21% of complaints for the beauty industry involved sales tactics.

The exertion of undue pressure on a consumer to enter into a transaction involving goods or services is prohibited under the Consumer Protection (Fair Trading) Act (CPFTA) and consumers can seek recourse under it.

A list of some of the unacceptable sales tactics commonly encountered by consumers can be viewed below.

Barred from Leaving Salesperson(s) had expressly stated that the consumer could not leave the room and/or blocked the exit until he/she agreed to the purchase.
Consumer Disadvantage Salesperson(s) had placed the consumer in a disadvantaged position such as exerting pressure during treatment while the consumer was partially undressed and/or stopping a treatment halfway unless the consumer agreed to the purchase.
Consumer Consent Salesperson(s) did not seek the consumer’s express consent for the purchase. E.g. The staff had proceeded with the transaction and swiped the consumer’s credit card without his/her permission. The consumer had to sign the receipt as the staff refused to void the transaction.
Excessive Tenacity Salesperson(s) had coerced and followed the consumer to the bank/ATM machine to withdraw money. 
Mental Exhaustion Salesperson(s) had kept the consumer in the shop for excessively long hours to pressure him/her to make a purchase.
Withhold Belongings Salesperson(s) had refused to return the consumer’s personal belongings. E.g. The consumer’s personal belongings were kept aside in a locker or by the staff.

CASE has been stepping up our efforts to address the problem of pressure-selling in these industries. We have been actively encouraging businesses in these industries to voluntarily commit themselves to ethical business practices by signing up for CaseTrust accreditation. Accredited businesses are subjected to a rigorous audit to assess their conformance to the accreditation criteria, which includes price transparency, well-trained sales staff with ethical sales tactics and prepayment protection amongst others.

Meanwhile, consumers who plan to purchase slimming, beauty and/or hair products or services are advised to take note of the following tips:

  • Be cautious about entering a transaction with businesses which do not provide important documents such as invoices, sales agreements, terms and conditions, and package descriptions.
  • Make an informed decision by reviewing the agreement and its terms and conditions carefully. If necessary, ask for a copy of the agreement and go back to the shop on another day.
  • Do not be fooled by “special discount” or “one-time only” offers. There might be other similar products or services in the market that are selling at comparable prices. Take some time to research on the product or service.
  • Pay attention to your emotions. If you start to feel overwhelmed, uneasy or intimidated during the sales pitch, request to stop the session and leave the shop. Do not make any financial commitments to the staff under such circumstances.
  • Exercise your right and walk away from a dubious deal with unclear terms or “aggressive” sales tactics. Be polite but firm when stating your refusal. You can consider bringing a friend or family member along for additional assistance and/or call the police if you are not allowed to leave.
  • Ask if there is a cooling-off period for the package. For example, CaseTrust accredited spa and wellness businesses offer a five-day cooling-off period for consumers.
  • Consumers should note the risks of making prepayments as they may face difficulty in recovering their prepayments if the business closes down abruptly. Where possible, they should minimise the amount of prepayment made and use payment methods that afford prepayment protection.

Consumers who are interested to learn more about how to shop wisely for beauty-related products and services can drop by CASE’s consumer education fair “Beauty Matters” on 28 July 2018. Registration is free. More information can be found on our website at: https://www.case.org.sg/events.aspx.  

Consumer Advisory - oBike: Affected consumers to file Proof of Debt with appointed liquidator
 

The Consumers Association of Singapore (“CASE”) understands that oBike Asia Pte Ltd (“oBike”) will be appointing an independent liquidator to handle the distribution of their assets and remaining affairs. Upon commencement of the liquidation, there will be a stay of proceedings on all litigation action. This means that any claim by consumers against oBike will not be able to proceed.

Once the company is in liquidation, affected consumers should file their Proofs of Debt against oBike with the appointed liquidator. Consumers should also attach copies of any relevant receipts or other supporting documents to the Proof of Debt form. Those who are unsure about how to file Proof of Debt may contact CASE for further assistance (hotline: 6100 0315, website: www.case.org.sg).

Meanwhile, affected consumers who have paid a deposit/membership fee to oBike via their credit card should contact their card issuer immediately and ask for a chargeback. Please note that this only applies for transactions entered in the last 120 days. For more information on lodging a chargeback, please refer to CASE’s Chargeback Guide for Consumers.

As a general principle, we encourage consumers to minimise their prepayments/deposits where possible, as their advance payment may be lost in the event of an abrupt business closure. Consumers who have reservations about paying a deposit may wish to consider other bike-sharing options that do not require a deposit payment or reduce their risk by choosing a “per use” option, where they pay a small amount of money each time they use the bike-sharing service. They should also look out for businesses that offer protection for their prepayment/deposit.

*Update [6 July 2018]: oBike has appointed Mr Joshua James Taylor and Mr Yit Chee Wah of FTI Consulting as their provisional liquidators on 5 July 2018. As oBike had previously committed to raise funds from alternative sources (e.g. their shareholders) to provide a full refund of consumers’ deposits, CASE will work closely with the Land Transport Authority to understand from the liquidators if the liquidation process poses any obstacles behind oBike’s pledge to provide a full deposit refund to consumers. Consumers are advised to wait for an update from the company or the liquidators on the refund process before filing for a refund.

*Update [12 July 2018]: The provisional liquidators of oBike have announced that affected consumers with existing deposits with oBike should submit their claim together with their relevant supporting documents (e.g. credit card/PayPal statements) online at www.obikedepositholders.com as soon as possible. The liquidators will examine and adjudicate on all claims received. Consumers who are unsure about the submission of claims may contact CASE for further assistance (hotline: 6100 0315, website: www.case.org.sg).

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