TripAdvisor's logo. Picture: REUTERS/Mike Blake
TripAdvisor's logo. Picture: REUTERS/Mike Blake

Melbourne — Harry Triguboff, Australia’s richest person, has become embroiled in a dispute with the country’s competition watchdog, which is suing his serviced apartment business for allegedly preventing customers from writing negative Tripadvisor reviews.

The Australian Competition and Consumer Commission alleged in a Federal Court action on Thursday that Meriton Property Services had engaged in "misleading or deceptive conduct in connection with the posting of reviews of its properties on Tripadvisor".

The commission alleges that between November 2014 and October 2015, Meriton took steps to prevent guests it suspected would give negative reviews from receiving Tripadvisor’s "Review Express" e-mail. It alleges that Meriton staff attempted to do this by inserting additional letters into guests’ e-mail addresses provided to Tripadvisor, which rendered the addresses ineffective, or by not sending e-mail addresses to Tripadvisor.

"We allege that Meriton’s conduct was a deliberate practice, undertaken at the direction of Meriton’s senior management, aimed at minimising the number of negative reviews," said Australian Competition and Consumer Commission head Sarah Court.

"This practice was likely to create a more positive or favourable impression of the standard, quality or suitability of accommodation services provided by Meriton," she said.

The commission said Meriton had on several occasions engaged in the conduct when guests were staying at one of its hotels where infrastructure or services had failed, for example when there was no hot water or a lift was not working. Meriton has denied the claims and said it would fight the court action.

online customer reviews scrutiny

The Australian case is the latest controversy regarding online customer reviews and fake news on popular websites

"In every Meriton serviced apartment there is a notice inviting all guests to review their stay on Tripadvisor. Meriton denies that the public has ever been deceived or misled," said Joseph Callaghan, Meriton Group general counsel.

The Australian case is the latest controversy regarding online customer reviews and fake news on popular websites. Last year, Amazon began legal action against 1,000 people it claimed were providing fake reviews on the US version of its website for a fee. This week Facebook vowed to crack down on fake news sites circulating on its platform following criticism suggesting these stories may have influenced the US presidential election.

In 2014, Tripadvisor was fined by Italian antitrust authorities for failing to do enough to prevent false reviews on its site.

Court said customers relied on independent review platforms such as Tripadvisor when making purchases. "If reviews are manipulated to falsely create a more favourable impression about a provider, consumers may choose that provider on the basis of that falsehood over another accommodation provider who has not engaged in misleading conduct," she said.

The commission is seeking penalties including fines and costs. Tripadvisor said it believed in "the rights of the travel community to share their genuine experiences — both positive and negative…. We take all reports of fraud and abuse submitted by our community seriously and regularly take steps to ensure business owners are aware of the strong penalties they face should they not adhere to our strict guidelines."

Meriton Serviced Apartments claims to be Australia’s biggest provider of hotel rooms, offering more than 4,500 suites across 18 locations. It was founded in 2003 as part of the Meriton Group, a property development company established by Triguboff in 1963.

This year’s BRW magazine, published by the Australian Financial Review, named Triguboff as the country’s richest person with a fortune of A$10.62bn (R111bn). He has earned the nickname "High Rise Harry" in Sydney, where Triguboff’s Meriton is at the forefront of an apartment-building boom and has benefited from a four-year surge in property prices.

Tripadvisor did not respond to a request for comment.

© Financial Times

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