KPDNHEP: 112.5% Increase In Complaints Related to E-Commerce Last Year

Alex Cheong Pui Yin

24th February 2021 - 3 min read

There has been a 112.5% increase in complaints about online shopping scams last year in comparison to 5,415 complaints received in 2019, said the Domestic Trade and Consumer Affairs Ministry (KPDNHEP). This is attributed primarily to the rising trend of e-commerce as more people move from offline to online shopping.

According to the Domestic Trade and Consumer Affairs Minister, Datuk Seri Alexander Nanta Linggi, unethical and illegal marketing tactics are on the rise as online retailers continue to grow in number. One of such ways employed to increase profit-making include “yo-yo pricing”, he said – a method where merchants increase the price of their products when there is low supply, and then decreasing it when there is ample supply.

Aside from that, KPDNHEP also received complaints about predatory pricing, where prices are pitched beneath manufacturing costs in order to drive competitors out of business. “Another strategy often deployed is when retailers mislead consumers through fake discounts, which allegedly took place during the highly anticipated 11.11, Black Friday, and 12.12 nationwide sales,” said Datuk Seri Alexander.

(Image: Sinar Harian)

On top of these, consumers also face several other risks, including identity theft and credit card fraud. “Fraudulent offers and transactions are also increasing at alarming rates. In addition, e-commerce platforms are increasingly vulnerable to a growing illicit industry distributing harmful, unsafe, sub-standard or faulty products, including counterfeit and pirated products. In Malaysian, there have been a total of 2,997 cases of counterfeit products reported from 2017 to 2020,” the minister added.

Datuk Seri Alexander further reminded consumers that there are a few ways to protect themselves in the face of these problems, chief of which is to file a direct complaint with the e-commerce platforms. He said that most platforms will have policies in place to deal with such deceptions.

“For example, Shopee prohibits price manipulation and fake discounts as it creates a false impression of the product prices. Listings with misleading discounts will be suspended by Shopee for a first offence, with no penalty as warning. Similarly, sellers on Lazada are not allowed to offer misleading discounts during campaign periods and risk having products removed if found to be in breach of policy,” explained the minister.

(Image: Reuters/Darren Whiteside)

Alternatively, consumers can file their complaints through other parties, such as KPDNHEP’s Consumer Complaints Management Centre and the National Consumer Complaints Centre.

All that said, Datuk Seri Alexander urged consumers to always remain cautious when purchasing items online, such as carrying out their own research on pricing and quality beforehand. “Online shopping platforms should also consider improving their policies when it comes to allowing businesses using their platform to arbitrarily price their goods. These platforms should heighten their controls over businesses, so that when a problem such as fake or misleading discounts arise, these issues may be dealt with speedily to the consumers affected by such tactics,” he said.

(Source: The Malaysian Reserve)

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Alex Cheong Pui Yin

Previously covered recruitment-related stories and had a short stint as a copywriter for the property industry. She subsequently developed an interest in investment and robo-advisors.

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