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Uber Faces $26 Million Fine In Australia After Admitting It Misled Aussie Customers

Uber Faces $26 Million Fine In Australia After Admitting It Misled Aussie Customers

The rideshare company said it tricked customers into thinking they would be hit with cancellation fees when their own policy said otherwise.

Uber has admitted to duping Australian customers into thinking they would be charged cancellation fees for rides, despite the company's own policy preventing any costs actually being charged.

The rideshare app's admission means millions of Australian customers may have been tricked into using their service to avoid fees that never would have actually been charged in the first place.

Uber now faces a AUD $26 million (£14.7 million) fine for deceptive conduct.

Alberto Grosescu / Alamy Stock Photo

The app's admission comes as the result of of an investigation by the Australian Competition and Consumer Commission (ACCC), who is suing the rideshare app in the Federal Court for misleading or deceptive conduct.

The ACCC claims that the app warned users from axing their trips by using a misleading cancellation warning for nearly four years.

Uber's own policy says that rides cancelled within five minutes will not incur a cancellation penalty.

Despite, this, users were still shown a pop up that read 'you may be charged a small fee since your driver is already on their way', even though they were cancelling within the five minute timeframe.

The ACCC said this may have led users to not cancel their rides because they thought they might have been charged.

According to the ABC, more than two million Aussies were shown the misleading cancellation warning.

“Uber admits it misled Australian users for a number of years, and may have caused some of them to decide not to cancel their ride after receiving the cancellation warning, even though they were entitled to cancel, free of charge, under Uber’s own policy,” ACCC chair Gina Cass-Gottlieb told the ABC.

B Christopher / Alamy Stock Photo

The app changed their cancellation pop-up in September 2021, which now tells users 'you won’t be charged a cancellation fee' for cancelling within the five minute window.

Uber has also admitted to massively inflating prices on their failed Uber Taxi feature, which was only available in Sydney between June 2018 and August 2020.

"Uber admits its conduct misled users about the likely cost of the taxi option, and that it did not monitor the algorithm used to generate these estimates to ensure it was accurate," Ms Cass-Gottlieb told the ABC.

"Consumers rely on apps to provide accurate information, and the misleading information on Uber’s app deprived consumers of a chance to make an informed decision about whether or not to choose the Uber Taxi option.

"Digital platforms like Uber need to take adequate measures to monitor the accuracy of their algorithms and the accuracy of statements they make, which may affect what service consumers choose.

"This is particularly important as online businesses often carefully design their user interfaces to influence consumer behaviour."

Featured Image Credit: Alex Segre / Alamy Stock Photo. tommaso altamura / Alamy Stock Photo.

Topics: Australia, Uber