These are some extracts from a News Release by the ACCC.
The Australian Competition and Consumer Commission obtained orders by consent
yesterday in the Federal Court at Melbourne against Imagine Essential Services
Limited and its founder and former Chief Executive Officer, Mr Richard Evans*, for
breaches of the Trade Practices Act 1974.
The ACCC alleged Imagine made misleading representations in connection with the
sale of licences to operate a system involving agreements which Imagine claimed to
have negotiated with essential service suppliers (such as telephony, electricity).
Under Imagine's system, licensees would approach businesses with a view to having
them take the purported benefit of Imagine's agreements to obtain the claimed
savings (earning commissions when businesses signed up). Small business people
invested anywhere between $60,000 and $250,000 to purchase a licence from
Imagine.
The ACCC also alleged Mr Evans, who gave presentations at a number of
workshops and seminars conducted by Imagine to promote the sales of licences,
was involved in Imagine's contravening conduct.
The ACCC's proceeding concerned four key groups of representations by Imagine
which were alleged to be false, misleading or deceptive and in some cases were
representations which Imagine had no reasonable grounds to make, namely:
• the profitability of the Imagine licensing system. For example, at one of the
two hour seminars conducted by Mr Evans on behalf of Imagine it was
represented that Imagine had a clear plan to create a passive income of over
$100,000 in 24-30 months.
• the number of customers that Imagine would give licensees through
agreements that Imagine claimed to have with accountants
• the number and variety of agreements that Imagine claimed to have with
essential service providers and the level of savings that Imagine licensees
could provide to customers as a result of those agreements, and
• membership to certain professional associations.
Justice Gordon of the Federal Court declared Imagine had engaged in the above
conduct in breach of the Act and that Mr Evans had aided and abetted and was
directly knowingly concerned and a party to the company's offending conduct.
"The judgment sounds a clear warning to companies promoting the sale of
businesses or franchises with the claim of quick returns of handsome profits," Mr
Samuel, said. "Companies must ensure they do their sums carefully and get them
right."
*This is not the Richard Evans who is the Executive Director of the Australian Retailers
Association and the former Chief Executive Officer of the Franchise Council of Australia
Limited.
The Australian Competition and Consumer Commission obtained orders by consent
yesterday in the Federal Court at Melbourne against Imagine Essential Services
Limited and its founder and former Chief Executive Officer, Mr Richard Evans*, for
breaches of the Trade Practices Act 1974.
The ACCC alleged Imagine made misleading representations in connection with the
sale of licences to operate a system involving agreements which Imagine claimed to
have negotiated with essential service suppliers (such as telephony, electricity).
Under Imagine's system, licensees would approach businesses with a view to having
them take the purported benefit of Imagine's agreements to obtain the claimed
savings (earning commissions when businesses signed up). Small business people
invested anywhere between $60,000 and $250,000 to purchase a licence from
Imagine.
The ACCC also alleged Mr Evans, who gave presentations at a number of
workshops and seminars conducted by Imagine to promote the sales of licences,
was involved in Imagine's contravening conduct.
The ACCC's proceeding concerned four key groups of representations by Imagine
which were alleged to be false, misleading or deceptive and in some cases were
representations which Imagine had no reasonable grounds to make, namely:
• the profitability of the Imagine licensing system. For example, at one of the
two hour seminars conducted by Mr Evans on behalf of Imagine it was
represented that Imagine had a clear plan to create a passive income of over
$100,000 in 24-30 months.
• the number of customers that Imagine would give licensees through
agreements that Imagine claimed to have with accountants
• the number and variety of agreements that Imagine claimed to have with
essential service providers and the level of savings that Imagine licensees
could provide to customers as a result of those agreements, and
• membership to certain professional associations.
Justice Gordon of the Federal Court declared Imagine had engaged in the above
conduct in breach of the Act and that Mr Evans had aided and abetted and was
directly knowingly concerned and a party to the company's offending conduct.
"The judgment sounds a clear warning to companies promoting the sale of
businesses or franchises with the claim of quick returns of handsome profits," Mr
Samuel, said. "Companies must ensure they do their sums carefully and get them
right."
*This is not the Richard Evans who is the Executive Director of the Australian Retailers
Association and the former Chief Executive Officer of the Franchise Council of Australia
Limited.
