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Warning to NZ Trustees Association Charitable Trust for sending invoices for unsolicited membership services

17 January 2018

The Commission has issued a warning to NZ Trustees Association Charitable Trust (the Trustees Association) about concerns with invoices it sent to registered New Zealand charities for membership services.

Following its investigation, the Commission found that the Trustees Association was likely to have breached the Fair Trading Act by invoicing the charities for membership services because:

  • the membership services were unsolicited and the Trustees Association had failed to clearly inform the charities they were under no obligation to pay the invoices
  • the invoices falsely represented to the charities that they had agreed to acquire the Trustee Association’s membership services.

The Trustees Association obtained the charities’ contact details from publicly available information and emailed them donating a free membership to the Association for around six months (finishing on 1 April 2016).

The charities received email bulletins from the Association throughout the six months, despite the fact that they had not taken any active steps to accept the donated membership. These bulletins contained a hyperlink for recipients to unsubscribe, but it was never made clear that they needed to opt out of the membership if they didn’t want to be charged.

If the charities hadn’t sent an email to the Association to unsubscribe from its communications before the donated free membership term ran out they were sent invoices for $158.70 for an annual membership subscription.

Competition and Consumer General Manager Antonia Horrocks said the New Zealand charities which complained to the Commission said they received an invoice for a membership which they had not agreed to purchase.

“In our view, the Trustees Association made a misleading representation that these charities had agreed to acquire paid membership services from the Association when they hadn’t. The invoices also failed to inform recipients that they were under no obligation to pay it,”Ms Horrocks said.

The Trustees Association responded to the Commission’s enquiries by saying it did not believe it had breached the law. In its view, the donated membership provided recipients with the option of unsubscribing.

The Commission does not agree that failing to unsubscribe from the Trustees Association’s email communications meant that the charities had agreed to subscribe to the Association on an annual basis. It was never disclosed to the charities that a failure to opt-out of the donated membership/email communications would result in them being invoiced for continued membership.

Background

On its website, the NZ Trustees Association Charitable Trust describes itself as having the principal objective of providing a free helpdesk and education to the public, trustees, and beneficiaries.

You can see a copy of our warning letter on our Enforcement Response Register.