Consumer fraud on the rise

Highlights

Consumer Fraud in the last decade

• Tk130,379,180 in fines over 22,286 complaints for not using packaging
• Tk40,840,050 in fines over 16,934 complaints for not showing goods price list
• Tk51,262,980 in fines over 15,836 complaints for overcharging
• Tk6,570,700 in fines over 686 complaints for selling adulterated goods
• Tk1,983,750 in fines over 535 complaints for not showing services price list

The Directorate of National Consumer Rights Protection has been working round the clock to regulate different markets across Bangladesh, but its efforts to enforce regulations on traders was not very successful in the last decade.

Data collected by the directorate during drives at different markets and complaints filed by the customers indicate that traders are increasingly engaging in consumer fraud, which in turn has raised questions about the state of consumer rights protection in the country.

Sources from the directorate say it has been carrying out drives and monitoring markets at divisional, district and upazila levels throughout the country on a regular basis, and the number of traders getting caught after defrauding consumers have been rising rapidly.

The traders are committing multiple types of consumer fraud, such as not displaying the price-list of goods and services, overcharging consumers, trading adulterated goods, and selling products without proper packaging.

According to data from the directorate, nearly 40,000 people took legal action after becoming victims of consumer fraud in the last decade, and 95% such incidents occurred in the last five years.

Despite getting defrauded by traders frequently, a majority of consumers are not taking legal action. Authorities concerned told The Business Standard that most victims do not seek legal support from the Directorate of National Consumer Rights Protection.

Commenting on the issue, Consumers Association of Bangladesh's (CAB) Vice-President SM Nazer Hossain said, "The number of culprits getting caught is going up in tandem with the number of drives conducted in different markets.

"Such a trend indicates that the punishments handed down to these traders were unable to raise awareness among them, or initiate a change in their behaviour."

Mentioning the onion price hikes last year, Hossain said, "We all know what happened after the Indian government halted onion exports to Bangladesh on two occasions. The traders are now defrauding consumers on the rice prices. There is no solution to this predicament."

The Directorate of National Consumer Rights Protection began its journey in 2009 with the aim to safeguard the people from deceptive business practices. Since its inception, the directorate has been carrying out market monitoring and regulation on a regular basis.

But the authorities concerned think the number of victims seeking legal action is too low, as more and more traders are getting caught during drives at the markets for committing consumer fraud.

During this period, 97,309 businesses have been punished for their involvement in consumer fraud.

According to the directorate, the number of traders engaging in deceptive business practices have skyrocketed in the last four years. In the 2016-17 fiscal year, 9,306 businesses were punished for fraud, but 22,244 businesses received punishment in the FY2019-20.

The data indicates that the number of offending traders have more than doubled since the last four years.

Under such circumstances, Bangladesh is observing the World Consumer Rights Day with the slogan "Our Oath in Mujib Year is to Curb Plastic Pollution" on Monday. The day was first observed by an organisation named Consumers International in 1983. Presently, 120 countries including Bangladesh mark the occasion every year on 15 March.

'A few of bad apples'

When approached for comments on the matter, Bangladesh Shop Owners Association President Md Helal Uddin said, "There are a few bad apples in every profession. We have laws and punishments for such people. Those who engaged in consumer fraud are getting punished."

He also claimed that traders sometimes refrain from hiking prices of goods considering the humanitarian angle.

Commenting about the two-time hike in onion prices, Helal Uddin said, "When a crisis unfolds centring a particular product, the Directorate of National Consumer Rights Protection fails to regulate the market properly. This in turn gives some traders the opportunity to commit crimes."

Meanwhile, CAB Vice President SM Nazer Hossain said, "After conducting many campaigns at different locations, we had hoped for a larger response from the consumers about this issue. People can resolve such a matter only when they are aware of it.

"Consumer fraud will keep rising if people do not become more aware."

The directorate pays the victim 25% of the fine after their complaints against a trader are verified.

But, very few consumer fraud victims actually seek the directorate's support despite such incentive. Speaking on the matter, its Deputy Director (Dhaka Division) Monjur Mohammad Shahriar said, "We have been raising awareness among the traders and consumers simultaneously about their responsibilities and rights. 

"If the victimised consumers still do not approach us for support, then we must boost our activities."

When asked about Bangladesh's position in the world in terms of consumer rights protection, Shahriar said, "We take action against any group of traders attempting to manipulate the market. We have the capacity to regulate the markets quickly.

"We have also significantly increased the number of drives being conducted at different markets."

The Business Standard has spoken with a number of consumers on the issue. 

When asked whether he visits the Directorate of National Consumer Rights Protection after facing consumer fraud, Shariful Islam from the capital's Jhigatola area said, "In this country, the prices of onion, salt, potato and edible oil go through the roof without any valid reason.

"So, I do not feel like approaching them [the directorate] for relatively tiny matters."

Another consumer from Rampura, Mohammad Al Amin said, "Though the directorate pays consumers money when they find validity of any complaints, I do not go to them after suffering small scale consumer fraud."