Graeme Samuel is not happy at comments from Gerry Harvey or with a fax from within the company about dealing with the ACCC.

ACCC chairman Graeme Samuel has taken aim at Harvey Norman and its chairman, Gerry Harvey, calling on him and the company to improve its ‘culture of compliance” with the Trade Practices Act.

Mr Samuel was commenting on reaction from Mr Harvey to the settlement earlier this week of the long running ‘bait and switch” advertising case brought by the ACCC against Harvey Norman in 2002, and on a fax from within the company, dated May this year, that indicated continuing suspicions about the Commission.

The ‘bait and switch’ case started with the original ACCC action back in November 2002. See how it was announced here.

It saw a loud attack on the then ACCC chairman, Professor Allan Fels in 2002 and 2003 from the colourful Harvey Norman chairman. Mr Harvey labelled Professor Fels as a meglomanic and dangerous. But after Professor Fels expressed surprise at the nature and the bitterness of the attack, the comments from Mr Harvey cooled and he and the company went silent as they started trying to settle the case. It was done this week and you can check out the settlement announcement here.

Mr Samuel told Crikey on Thursday he was doubtful about statements by Mr Harvey that Harvey Norman wanted a new start with the Commission. Mr Samuel said that any new relationship “ultimately depended on compliance with the Trade Pratices Act from the chairman and CEO all the way down the company”.

But he wondered whether this was the case at Harvey Norman as the Commission had been sent an internal Harvey Norman document which showed that there “wasn’t a spirit of cooperation at Harvey Norman”.

The document which Mr Samuel said the Commission had received from at least three sources, including Harvey Norman, was sent in May to “all franchisees” by the company’s Finance Director John Skippen.

The fax which can be seen here – is headed “ACCC Alert” and in it Mr Skippen said “As a representative of the Franchisor I recommend the following.

“Please supply information regarding suspected visits from the ACCC. Where staff were approached and questioned please forward the information urgently either by email to———— or by fax to ———” (name and numbers withheld)

“Information Required. Name of sales person, date, time, what questions were asked of staff, what product was purchased, what price was paid, if the goods were to be delivered, was a business or personal address given (we do not need to be advised of the address), what form of payment was used – cash or credit card. If a credit card was used, was it a personal card or a business card.

“Please enure that should you or any of your staff be suspicious that a customer could be from the ACCC, be sure to take a photo of theperson, with a digital camera (no more bold) clearly showing their face – maybe say ‘smile customer relations day’.”

Regards, John Skippen.”

And it was CCed to Katie Page, who is Gerry Harvey’s wife and the managing director of Harvey Norman and who also oversees the company’s Domayne chain, John Skippen, John Slack-Smith, who was also named in the original ‘bait and switch’ action by the ACCC back in 2002, Stephen Hauville, Tracey Huckel, Ross Page and Jillian Dean. Messrs Slack-Smith and Hauville are both directors of Harvey Norman.

Mr Samuel said this fax was “hardly a good basis for good relations” going forward between the Commission and the company. He said it showed the company was suspicious.

“We are at the begining of the process with Harvey Norman and they are a very long way from the end of the process,” Mr Samuel told Crikey. “The memo indicates the battle we have with the (Harvey Norman) organisation.”

Mr Samuel said he was disappointed by the comments this week made in the wake of the settlement by Mr Harvey.
This is how the settlement was reported in The Age.

Mr Harvey was quoted as saying:

 “The only thing I want to say, or could say, really, is there’s a new chairman, there’s an improved approach by the ACCC. We now believe we can communicate with them in a reasonable manner.”

But this is what The Australian reported:

“But CEO Gerry Harvey said yesterday he still did not believe the company had done anything wring in advertising software packages worth more than $900 for just $199, then not ordering enough stock to meet demand”.

And The Courier-Mail in Brisbane:

“When the ACCC began prosecuting the matter in 2002, a media slanging match between Gerry Harvey and then-chairman of the ACCC, Professor Allan Fels, in which Mr Harvey labelled the high-profile chairman as a smiling assassin, a megalomaniac, mischievous and dangerous.”

Mr Samuel said he was disappointed with the fax and it indicated the company was a long way from understanding the need for compliance.

“It starts with the chairman and the CEO,” he said. “That is important.”