Case probes 'hidden' charges by StreetDeal

A FEW days after avid online shopper Smith Leong bought a set of drumsticks from e-commerce site StreetDeal, he was shocked to see a separate $88 charge on his credit card bill.

The drumsticks were priced at $16.40.

"I thought I might have accidentally bought something else, so I quickly logged onto my StreetDeal account, checked all my invoices and e-mail. Nothing in the history showed that I made any other purchase," said the self-employed 31-year-old, who made the purchase last month.

When he contacted the home-grown firm, he was told the extra charge was a premium membership fee, and that it had been outlined clearly during the purchasing process and in terms and conditions.

"I felt cheated," said Mr Leong, adding that he was refunded the $88 in credit for future purchases after numerous angry e-mail messages back and forth with the firm. "But I would rather just have my money back."

The Consumers Association of Singapore (Case) has received 49 complaints against StreetDeal since January last year, close to double the 24 received in 2012 and 2013.

The grouses follow a similar pattern, with the majority of cases about "hidden" membership charges - either a one-time charge or in instalments.

Case is investigating the matter. It said the firm could be flouting the Consumer Protection (Fair Trading) Act (CPFTA). Under this Act, it is an unfair practice to use small print to conceal a material fact from a consumer, said Case executive director Seah Seng Choon.

"We feel that it is unfair for StreetDeal to charge consumers for premium membership fees if the consumer did not explicitly state that they want to sign up for this membership and this could be a misleading claim under the CPFTA," he said.

When contacted, Gregory Costamagna, StreetDeal's chief executive, said the company has received some complaints from customers who claimed it was unclear that they were signing on for a membership. However, they made up only 1 to 2 per cent of their premium members here, he said.

At the checkout page, shoppers need to agree to be charged the membership fee, said Mr Costamagna. When they make payment, they are shown only the amount for the items purchased. The membership fee is excluded because shoppers are given a two-day free premium membership trial before they are charged, he said.

"If they want to cancel before the free trial, they can do so. And once we charge customers two days later, we send them another e-mail to tell them about the charge," said Mr Costamagna, adding that customers will get a refund in credit if they want one.

Launched in 2010, StreetDeal has 5,000 to 10,000 premium members in Singapore. Premium members return to the site to shop three times more than regular members, said Mr Costamagna. StreetDeal also operates in countries including Malaysia, Thailand, the Philippines and Australia.

But Mr Leong thinks that more clarity is needed.

"Yes, I did miss the part where I was told I was going to have to pay $88. But it should be reflected as part of charges and I should receive an invoice," he said.

Vera Ong, 29, was charged $9.90 a month for membership for three months on her credit card. She called StreetDeal and the charges were halted, but she did not receive any refund, she said.

"Sure, it is my responsibility to read the terms and conditions, but surely they should have proper forms for us to sign and fill out for subscriptions," said Ms Ong, who is self-employed.

"If not, any business can make us pay for subscription fees without us knowing."

limjess@sph.com.sg

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