Ho-ho-hold off on offering customers so-called ‘buy now, pay later’ promotions that see customers allegedly pay inflated prices through “hidden fees,” federal regulators told iconic Canadian furniture retailers Leon’s and The Brick on Tuesday.
The Competition Bureau said Tuesday it has filed suit against the companies with the Ontario Superior Court of Justice seeking a halt to the “deceptive” practice, which involves advertising payment options where buyers are told they can defer payment until a later date but are then confronted with certain upfront fees.
“In this case, the retailers buried details of the additional up-front fees in fine print, which led to the final price of a product being higher than the advertised price,” a statement from the federal bureau said.
Leon’s, which has used the well-known holiday slogan of ‘ho-ho-hold the payments’ in its Christmas marketing for years, is in the process of acquiring The Brick, a merger the Competition Bureau cleared earlier this year.
But the body is sending a clear message that the combined chain will have to alter its selling methods. In the suit, it demands an end to “this type of deceptive advertising,” as well as refunds for customers who paid so-called administration or processing fees.
The bureau is also seeking administrative monetary penalties from the companies.
“When a price is offered to consumers for a product, it must be both clear and accurate,” Lisa Campbell, the deputy commissioner for the bureau’s Fair Business Practices Branch, said.
The allegations have not been proven in court.
Leon’s responded to the announcement with a statement saying the company will defend itself in court.
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