ASIC warns comparison websites are misleading consumers

ASIC has issued a warning after commencing court action against multiple comparison websites that have allegedly misled consumers, the ABC reports.

The corporate watchdog alleges the sites provided misleading information about their financial services and products. Some have also promoted offers from only one brand.

ASIC commissioner Alan Kirkland said, “The products that are listed by many comparison sites are selected and ordered based on what the product providers pay to the comparison sites, and they may not give you a full view of the market.”

“It's important to actually use a range of comparison sites in order to get a fuller view of the market.”

Comparison sites can be misleading

The Federal Court recently found comparison site Choosi, which offers financial products, misled consumers over four years from mid-2019.

It was found that the policies invesitigated were distributed by Greenstone Financial Services, a company linked with Choosi.

The ABC also reported that last week, ASIC launched a case against Clark Family Pty Ltd, which offers free online assessments for loans and insurance products.

The commission alleges "up to 70 of its websites misled consumers by claiming to compare rates and options from multiple providers and providing consumers "tailored" recommendations."

Alan Kirkland said, “In reality, consumers' inquiries were (allegedly) sold to the highest-bidding broker.”

He added that it was cases like this that have lead to ASIC warning Australians.

"We've got very strong laws in Australia against making false or misleading representations about the products that you provide to consumers.

“Where we find comparison sites misleading consumers, we will take action.”

ASIC also warns consumers should protect their data on these sites.

“Your information may not be used solely for the purpose of the comparison that you're seeking,” Kirkland said.

“Your personal details may be sold to another business."

ASIC’s Moneysmart website has guidance for consumers for how to use comparison websites for insurance and other financial services.