CONSUMER Protection is urging WA consumers not to pay large deposits for goods and services, with Commissioner Anne Driscoll saying it was risky business.
The agency has received more than 400 inquiries and 113 complaints so far this year from consumers who had paid deposits, but the trader then failed to supply the goods or services.
“A vast majority of the calls and complaints involved consumers paying a deposit of more than $5000, with one consumer paying $60,000 up front,” Ms Driscoll said.
“These are large amounts to put at risk if the trader fails to deliver or faces financial difficulties that prevent the provision of the service or goods.
“Generally our advice is to pay no more than 10 per cent deposit, and only if it’s required to secure the sale.
“Never pay the full amount upfront until the item has been delivered, or the work carried out.
“In the case of a product being custom-built for a customer, the trader may have a valid reason to demand a higher deposit, but those circumstances would be rare.”
“Consumers may consider using a credit card to pay for large deposits because there is a possibility of claiming a charge-back should something go wrong.”
She said traders were required by law to deliver the products or carry out the services within an acceptable timeframe.
“Australian consumer law states that work must be completed in accordance with a contract stipulating a date of completion, or within a reasonable timeframe,” she said.
“Traders may be in contravention of this law if they accept deposits and then don’t carry out the work for several months.
“What is a reasonable timeframe will depend on the particular circumstances.”
Consumers having problems receiving goods and services after paying deposits should contact Consumer Protection on 1300 30 40 54 or email@example.com.