Kmart hit with $1.3 million fine from communciations watchdog ACMA

Tired of spam emails?  So are the Australian Communications and Media Authority (ACMA). The communications watchdog has made enforcing e-marketing unsubscribe rules one of its priorities for 2023 and 2024.

ACMA have stated that they understand that consumers are frustrated by businesses that don’t respect their right to stop receiving direct marketing. Over the last 18 months, businesses have paid more than $12.5 million in spam and telemarketing penalties. ACMA have decided to concentrate on businesses that don’t action opt-out requests and they’ve already had one major aussie retailer in their sights.

Kmart have recently been slapped with a 1.3 million dollar fine by the communications watchdog for sending more than 200,000 marketing emails to people who had already unsubscribed.

ACMA opened an investigation following numerous consumer complaints. The investigation found that Kmart had sent 212,471 messages to customers between July 2022 and May 2023 who had previously unsubscribed. It was revealed that the breaches occurred due to a combination of technology, system and procedural failures.

ACMA Chair Nerida O’Loughlin said customers are frustrated and angry with big brands intruding on their privacy by not respecting their wishes to unsubscribe.

“When a customer decides to opt out of a marketing mailing list, businesses are obliged to fulfil that request. The rules have been in place for nearly 20 years and there is simply no excuse. Kmart’s case is particularly concerning as it went on for such a significant period,” Ms O’Loughlin said.

Even before opening its formal investigation, the ACMA alerted Kmart on multiple occasions it may have issues with its consumer marketing.

“Kmart was given more than enough notice it may have a compliance issue, and it should have done more to address its problems before we had to step in and investigate,” said O’Loughlin.

The current spam rules require that businesses have consent from consumers for e-marketing. When a consumer request to unsubscribe, the request must be actioned, requests which Kmart have not complied with.

In addition to the financial penalty, the ACMA has also accepted a comprehensive two-year court-enforceable undertaking from Kmart where they will commit to appointing an independent consultant to review its compliance with spam rules and to make improvements where needed. Kmart must also report regularly to the ACMA.

“Any business that conducts e-marketing should be actively and regularly reviewing its processes to ensure it is complying with the rules,” Ms O’Loughlin said.

This action follows recent enforcement taken against other companies that have breached the spam laws, including DoorDash, Ticketek, and Uber. The ACMA also recently accepted enforceable undertakings from Webull and The Wine Collective after they admitted they contravened the spam laws.