Misleading Finance Ad Penalty
Federal Court Fines Harvey Norman, Latitude $55M for Deceptive Finance Campaign
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Key Points
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Justice O’Bryan singled out Harvey Norman executive chairman Gerry Harvey for his public comments, criticizing a perceived lack of contrition and noting there were no steps taken to prevent future breaches.
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Market reaction included Harvey Norman’s shares falling about 2% on the news, while Latitude Finance Australia’s shares edged up around 0.4%, with Harvey Norman later partially rebounding.
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The nationwide campaign ran from January 2020 to August 2021 across television, radio and newspapers, with thousands of ads likely viewed by millions of Australians.
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The adverse publicity order included Harvey Norman publishing a notice on its website; the company had already accrued about 16.2 million against the liability and is expected to recognise further expense in the 2026 financial year to cover the remaining amount.
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The court estimated the financial benefit derived from the campaign at around 5 million, underscoring the scale of the misrepresentation and its impact on the consumer market.
Australia's Federal Court has handed down a record $55 million penalty against Harvey Norman and Latitude Finance for a misleading advertising campaign that deceived millions of shoppers. ABC News reported the court fined Harvey Norman $35 million and Latitude Finance $20 million — the largest combined penalty ASIC has ever won for misleading conduct involving financial products.
The ads promoted a 60-month, interest-free finance deal but never told customers they had to sign up for a Latitude GO Mastercard, which came with ongoing fees. The campaign ran from January 2020 to August 2021 across TV, radio, and newspapers, and was likely seen by millions of Australians, Nine reported.
What the Ads Said Versus What They Hid
Harvey Norman and Latitude ran thousands of ads spruiking a 60-month interest-free deal. The catch: customers had to take out a Latitude GO Mastercard to access it. That card came with ongoing account fees and, until March 2021, an establishment fee too. None of that was clearly disclosed in the ads, Daily Mail reported.
The court found the campaign distorted the consumer market and put sales ahead of customer interests. ASIC Chair Sarah Court said businesses must ensure their financial advertising is transparent and accurate. The court estimated that Harvey Norman and Latitude gained around $5 million in financial benefit from the misleading campaign.
Gerry Harvey Called Out for Lack of Contrition
Justice O'Bryan did not hold back. He singled out Harvey Norman executive chairman Gerry Harvey by name, criticising his public comments after the case. The judge said Harvey showed no contrition and that the company took no steps to prevent future breaches. That directly pushed Harvey Norman's penalty higher, ABC News reported.
Latitude fared slightly better in the court's view. The judge noted the company had made compliance improvements since the campaign ended. Still, Latitude was hit with a $20 million fine. Both companies were also ordered to run corrective advertising and share ASIC's legal costs.
Harvey Norman Shares Dip as Latitude Edges Up
Markets responded quickly to the ruling. Harvey Norman shares fell about 2% on the news before partially recovering. Latitude Finance shares edged up around 0.4%, Grafa reported. The divergence likely reflected investor relief that Latitude's fine was smaller than feared, combined with concern over Harvey Norman's governance.
Harvey Norman had already set aside about $16.2 million against the liability. But the $35 million fine means the company will need to book further expense in its 2026 financial year to cover the remaining amount. That will weigh on near-term earnings.
ASIC's Record Win Sends a Warning to Retailers
ASIC Chair Sarah Court called the outcome a clear message to businesses. "Consumers are entitled to accurate information when making financial decisions," she said. Justice O'Bryan framed the $55 million total as a strong deterrent — not just punishment for Harvey Norman and Latitude, but a warning to the entire market, Nine reported.
Law360 noted the result is ASIC's largest-ever penalty for misleading conduct in financial products and services. The corrective advertising order adds a public accountability element. Harvey Norman must publish a notice on its website. For businesses running similar finance promotions, the message is simple: disclose the fees or face the consequences.
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