Product Misrepresentation and Caveat Emptor PDF Guide

PRODUCT MISREPRESENTATION & CAVEAT EMPTOR Misrepresentation is observed when there is a transformation of information to misinformation. to represent incorrectly, improperly, or falsely. 2 Types of Misrepresentation 1. INTENTIONAL OR FRAUDULENT MISREPRESENTATION – a scenario w...

PRODUCT MISREPRESENTATION & CAVEAT EMPTOR Misrepresentation is observed when there is a transformation of information to misinformation. to represent incorrectly, improperly, or falsely. 2 Types of Misrepresentation 1. INTENTIONAL OR FRAUDULENT MISREPRESENTATION – a scenario whereby the person is fully aware or deliberately misrepresents things, commonly known as lying. Telemarketing Fraud: calls on behalf of a charity benefit shows free or low-cost vacations Work at Home Ads- spend your own money to place ads, make copies, or buy envelopes and stamps for customer mailings “Would you like to earn hundreds of dollars a week at home in your leisure time? Many people are supplementing their income in a very easy way. Let us tell you how…” 2 Types Of Misrepresentation 2. UNINTENTIONAL OR NEGLIGENT MISREPRESENTATION – a scenario whereby the person is not aware and does not deliberately act on misrepresenting things. It is a situation where the person involved believes that it is the right and acceptable thing to do. It is also commonly called as a white lie TYPES OF LYING 1. USE OF AMBIGUOUS TERMS - Is the act of deliberately using vague terms or open-ended statements that can have several meanings to mislead people that one is telling the truth. TYPE OF LYING 2. USE OF FALSE STATEMENTS - Is the act of making a statement from which false conclusions may be drawn, eventually misleading others. This type of lying is often observed in advertising a product to be the “best-seller” brand. TYPES OF LYING 3. LYING THROUGH ACTION - Is a type of lying where the person gets caught in the act of wrongdoing. TYPES OF LYING 4. SUPPRESSION OF CORRECT INFORMATION - Is an intentional or unintentional act of hiding the correct information which eventually misleads others. A brand advertises, “Lose 10kg in one month without diet or exercise!” but the pills have no real medical backing. Many people are misled into thinking they can lose weight effortlessly. A. Use of false statements B. Lying through actions C. Suppression of Correct Information A real estate company advertises a condo unit at ₱2 million but fails to mention additional fees like taxes, association dues, and transfer costs. Buyers only learn about these expenses after signing the contract. A. Use of false statements B. Lying through actions C. Suppression of Correct Information A street food vendor claims their taho has real arnibal (caramelized sugar), but a customer sees them mixing artificial sweetener instead. A. Use of false statements B. Lying through actions C. Suppression of Correct Information BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING DIRECT MISREPRESENTATION - is characterized by actively misrepresenting something about the product or service. It gives the business a bad name because deception and lying are used in the process of selling the product to the customers. A. DECEPTIVE PACKAGING - The objective is to create an impression wherein the buyers or the end users will see an improvement, either by size or by weight without any change in price BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING ADULTERATION - unethical practice of corrupting a genuine commodity by imitating or by adding something to increase its bulk or volume, or even by substituting an inferior product for a superior one for the purpose of profit or gain. BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING MISBRANDING OR MISLABELING - Is the act of copying a product’s design to the closest possible way giving an impression that it is the same with the leading brand https://www.dailymail.co.uk/news/article-2267340/Two-men- sue-Subway-shorted-inch-sandwich-called-footlong-doesnt- measure-ads.html BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING SHORT-WEIGHING - It can be easily spotted in wet and dry markets. Weighing scales are easily tampered by intentionally offsetting the calibration of the dials. It is practiced in selling products by manufacturers packing products in bulk. BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING SHORT CHANGING - taken directly from a situation where the seller gives the customer less than the change he should get. When the buyer receives less than what should be taken, the buyer is being shortchanged. BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING SHORT MEASURING - Is an unethical practice observed in products that depend on length and/or volume. The meter stick or standard is shorter than the real length or smaller in volume than the standard. It is sometimes observed in textile markets and electrical shops. BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING SHORT NUMBERING - The seller gives the consumer the quantity by piece of the product less than the number he has paid for. BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING MISLEADING ADVERTISEMENT - any representation or symbol that would cause a significant number of the general or relevant public to misunderstand or make incorrect decisions, regardless of whether such representation or symbol is consistent with facts. BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING BUSINESS PRACTICES INVOLVING MISREPRESENTATION & LYING INDIRECT MISREPRESENTATION - It is passive deception and not as obvious compared to direct misrepresentation. But it still contributes to the impression that businessmen are liars and are out to make quick money.  Some stations manipulate their pumps so that a liter of fuel is actually less than 1 liter, making drivers pay more for less fuel. a. Short Weighing b. Short Changing c. Short Measuring d. Short Numbering e. Misleading Advertisement  Some restaurants advertise "unlimited rice", but when customers ask for refills, they are given small servings or told there’s a limit after a few refills. a. Short Weighing b. Short Changing c. Short Measuring d. Short Numbering e. Misleading Advertisement  Some snack packs claim to have 20 pieces, but when customers count, they only get 18 or 19. a. Short Weighing b. Short Changing c. Short Measuring d. Short Numbering e. Misleading Advertisement  Some bakeries use less filling or butter, making the bread lighter while still charging the same price. a. Short Weighing b. Short Changing c. Short Measuring d. Short Numbering e. Misleading Advertisement caveat emptor- “let the buyer beware.”- standard in consumer purchases in the early part of the century Example - Real Estate Kelly decides to buy a house from Joe, her friend's friend. She had a look at the residential property quite casually as she trusted the latter with the purchase as he was known to her. Kelly paid him and shifted a week later. With time, she identified issues with water taps and the roofing system. She contacted Joe to discuss things and asked for a reduction in the amount she had to pay due to the additional costs she would have to incur on the house. Joe, unfortunately, refused to do so. Kelly then moved to the court of law. caveat venditor- “let the seller beware.”- society demanded that consumers be given more rights and held that manufacturers be held responsible  A snack brand uses oversized packaging that makes the product look bigger than it is. Customers complain, and the company must change the packaging to comply with fair trade laws. a. Caveat Emptor b. Caveat Venditor  A customer buys a used car from a private defectsseller without checking for hidden. Later, they find out the engine has major issues, but the seller refuses to take responsibility. a. Caveat Emptor b. Caveat Venditor  A buyer purchases a house based on pictures but later discovers plumbing and roofing issues. Since no warranty was provided, the seller is not responsible. a. Caveat Emptor b. Caveat Venditor  A fast-food chain sells spoiled fried chicken, making customers sick. The restaurant faces complaints and possible legal action. a. Caveat Emptor b. Caveat Venditor