ASA Adjudication on HPAS Ltd

Ad

A radio ad, for double glazing, featured nursery rhyme-like music in the background whilst a female voice said "The window man was a very merry man, a very merry man indeed. He found how to reduce his home's energy bills with Safestyle's energy efficient double glazing. To Safestyle he went with a skip and a jump, with just a few pence in his wallet, he knew Safestyle would punch that blasted credit crunch and offer a massive ...". A loud male voice continued the sentence, shouting "... 60% off Christmas! That's 60% off all windows and doors if you order now and fit in January! There's free fitting and flexible monthly instalments! That's 60% off bill busting energy saving double glazing. Call 0800 106XXX now!".

Issue

The complainant objected that the ad was misleading because it did not mention the typical APR which applied to the monthly instalments.

BCAP Radio Code

Response

HPAS Ltd t/a Safestyle UK (Safestyle) said that spreading the cost of the product in monthly instalments was not a condition of sale but rather an option to be decided upon by the consumer along with the colour and style of the product.  They argued therefore that, under The Consumer Credit Regulations, the typical APR information was not required to be stated in the ad.  

The RACC stated that their understanding of Consumer Credit regulations was that, unless an advertisement offered "incentives" for credit and/or mentioned the actual amount of the monthly repayment, a reference to the APR was not needed. They said they cleared the advertisement without a reference to the typical APR because they believed none was required.

Assessment

Upheld

The ASA noted the OFT Guidance on compliance with the Consumer Credit (Advertisements) Regulations 2004, section 3 "Content of Advertisements" stated that the typical APR must be stated if an advertisement included any incentive to apply for credit.   We consulted the OFT who said, in their view, the reference to "flexible monthly instalments" was an incentive that meant the ad should include the typical APR.  We noted the CAP (Broadcast) Radio Advertising Code required finance ads to be compliant with the Consumer Credit Regulations.

The ASA considered that, although Safestyle customers were not required to spread the cost of the payment for their purchases, the flexible monthly instalment scheme was a potential incentive to listeners to apply for credit through Safestyle. We concluded that the ad was likely to mislead consumers by omitting information relating to the rate of interest.

The ad breached CAP (Broadcast) Radio Advertising Code Rules 2 - 3.1 (Misleading advertising) and 3 - 1.2 (Financial products and services).

Action

We told HPAS Ltd t/a Safestyle UK to take care when making reference to flexible payment instalments in the future.

Adjudication of the ASA Council (Broadcast)