Time to get tough with bad hats, for Sim Lim's sake

The recent spate of unscrupulous trades at Sim Lim Square has made the ageing mall the talk of the town - for all the wrong reasons.

First there was the Commonwealth Games diving gold medallist from Malaysia who paid more than $4,800 for an iPhone 6 and an iPhone 6 Plus, which together would have normally cost about $2,500.

Two weeks later, a Chinese national who took another Sim Lim shop - the now notorious Mobile Air - to the Small Claims Tribunal got the refund of $1,010 that she asked for, but in an 18kg plastic bag of coins.

But what really riled Singaporeans happened the next day when a video of a Vietnamese tourist, reduced to begging on his knees for a refund at Mobile Air, went viral on social media.

In all three cases, they were buying the iPhone 6. Singapore was one of the first countries in the world where the new iPhones launched in September. High demand and limited supply meant that many consumers were happy just to get their hands on one.

All three were foreigners and said they had handed over cash to pay for their iPhones after they had reached an agreement on the price. At least two of them even paid slightly more than the usual cost of the phone. But before they could collect their phones, they were slapped with a surprise - they needed to pay extra for warranty (another $2,300 in one case) after being tricked into signing a warranty contract, they said. When they tried to ask for a refund, the shopkeepers refused and said they would charge a penalty ranging from a few hundred dollars to almost the full price of the phone.

After news broke about the current spate of events, two more persons came forward to tell of how they were similarly fleeced earlier. One was a 19-year-old undergraduate from India, the other was a Malaysian tourist.

Singaporeans were up in arms as stories of the underhanded tactics came to light. Some netizens who felt that the authorities were not doing enough resorted to their own form of online vigilantism. The question is: Can nothing be done against these errant retailers?

Complaints to the police over purchases at Sim Lim are common but the authorities seem to treat them as civil cases best resolved through the Small Claims Tribunal or the Consumers Association of Singapore (Case). Since the Consumer Protection (Fair Trading) Act was passed in 2004, Case can invite errant retailers to sign an agreement to not engage in unfair trade practices and even to agree to refund money to aggrieved consumers.

In the case of Mobile Air, that is exactly what Case has done. However, this is purely voluntary and there are no criminal penalties if the merchants later refuse to follow the terms of the agreement. It will work only on bona fide retailers who want to avoid bad publicity, not on shady ones who have no reputation to protect in the first place.

The second thing that Case can do is to apply to court for an injunction - essentially a court order for the merchant to stop engaging in unfair practices. But since the order is typically made against the company and not against the individuals working for the company, fly-by-night merchants can easily close shop and open a new business under a new company.

Over the last 10 years, Case has entered into eight voluntary compliance agreements and taken up five injunction proceedings.

There is also little that the management council of Sim Lim can do besides putting up notices to shame the errant retailers. As Sim Lim is owned by hundreds of landlords who lease out individual shop lots to retailers, the council cannot kick out errant retailers, unlike a single-owner mall where the tenancy agreements are signed directly between the owner cum landlord and the shops.

Perhaps the only solution is for the police to take action. They said last week that reports have been filed and they are looking into them.

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Member of Parliament Lim Biow Chuan, who is also the president of Case, said on Saturday: "For such cheating cases, the police should investigate further and where there is sufficient evidence, charge the culprit. This will send a strong message to the other like- minded retailers that they have to conduct their business in an honest manner."

Another MP, Mr Hri Kumar Nair, said that instead of having the police - who are already overstretched - play a more active role, neutral adjudicators could be appointed to resolve complaints of unethical business conduct.

Sim Lim has historically been the go-to place for consumers looking for great, often illegal, deals, from pirated content on CDs, VCDs and DVDs to fake iPods, at one time. But it has been cleaned up, especially over the last few years. The recent complaints were from consumers who were fleeced while trying to buy legitimate products.

Mr Lim is right that it is time for the police to take a serious view of the matter and prosecute if they can, to send a strong deterrent message.

Three lawyers interviewed said the alleged modus operandi of the Sim Lim shops may well amount to the offence of cheating under Section 415 of the Penal Code, which carries a fine and/or imprisonment for up to three years. It may even fall under the more serious offence of cheating and dishonestly inducing a delivery of property, which ups the maximum jail term to 10 years. However, they cautioned that a signed contract might make it challenging to prove that a shopkeeper has intention to cheat as overcharging by itself is not a criminal offence.

For ordinary Singaporeans, it seems an affront to common sense that errant retailers can get away with such tactics and tarnish the country's reputation for fairness and honesty. Many modern malls lack the melting pot character of a strata-title mom- and-pop mall like Sim Lim.

While the number of DIY PC shops catering to tech geeks has dropped from over 50 to about six, PC-building is still a thriving business catering to gamers, graphic designers and animators. There is lots to get out of Sim Lim for those in the know. You can build hobby planes, get cheaper but legal versions of Microsoft Windows, buy printer consumables at a bulk discount, find a replacement for that lithium ion battery in your cordless phone, buy 50m long cables to run from one end of your home to the other, and so much more.

But perhaps think twice about buying your mobile phone there.

ginlee@sph.com.sg

This article was first published on November 13, 2014.
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