23 May 2017

'Pure alpaca' deception leads to hefty fine

5:25 pm on 23 May 2017

A company and two of its employees that sold fake alpaca and cashmere duvets have been fined nearly $194,000 by the Commerce Commission.

Princess Wool claimed its duvets were "pure alpaca wool" or "100 percent cashmere", but independent testing found they contained little or no such fibres.

The company pleaded guilty to 14 charges and was fined $159,000. Manager Kevin Stocker was fined $20,187 on six charges and director Koo Yoarn Lee was fined $14,750 on six charges.

The case brought the total fines imposed in 11 cases against companies and individuals who made claims about alpaca, merino wool and cashmere duvets to just over $1.5 million, the Commerce Commission said.

"This sort of offending reflects negatively on New Zealand's reputation as a desirable tourism destination," Commerce Commission general manager of competition Antonia Horrocks said.

"Consumers buy goods like alpaca duvets on trust, because they cannot themselves verify the accuracy of product claims.

"Ensuring that traders don't mislead consumers over such claims is a priority for the commission.

"Claims such as '100 percent Pure Alpaca' and 'Pure Cashmere Duvet' were made on labelling and invoices, and directly to at least one retailer. In fact the duvets contained only minimal alpaca wool and no cashmere," Ms Horrocks said.

The commission obtained independent testing of five of Princess Wool's "pure alpaca" duvets.

The tests showed that the alpaca content was between 9 percent and 17 percent, with the rest sheep wool. Three "cashmere" duvets were shown by tests to contain no cashmere and 100 percent sheep wool.

In sentencing in the Auckland District Court, Judge Gibson noted that the offending "had the effect of punishing honest traders who were unable to compete with Princess Wool's prices".

Judge Gibson said the offending occurred when the industry was on notice that this type of offending would likely lead to prosecutions.

Princess Wool had twice assured the commission it would remove labels stating "pure alpaca" and, along with a number of other businesses, had also received a compliance advice letter about only making truthful 'Made in New Zealand' claims.

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