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ASA Ruling on Cash On Go Ltd. t/a Peachy.co.uk

Closed Contracts Expression

Key Details

  • Mode of Expression
    Electronic / Internet-based Communication
  • Date of Decision
    March 20, 2019
  • Outcome
    Motion Granted, Administrative Measures/ Administrative Sanctions that restrict FoE
  • Case Number
    A19-551528
  • Region & Country
    United Kingdom, Europe and Central Asia
  • Judicial Body
    Administrative Court
  • Type of Law
    Civil Law
  • Themes
    Commercial Speech
  • Tags
    Advertising

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Case Analysis

Case Summary and Outcome

The British Advertising Standards Authority (ASA) ruled that an emailed advertisement implying that consumers should take out a high-interest, short-term loan to protect themselves against financial uncertainty as a result of Brexit violated the Code of Non-broadcast Advertising and Promotional Marketing. The advertisement had played on people’s fears that Brexit may result in food shortages. The ASA held that the advertisement was irresponsible and risked putting “emotional pressure” on financially vulnerable individuals who were concerned about not being able to feed themselves or their families following Brexit.


Facts

On January 24, 2019, a British financial services company, Cash on Go Ltd (which was operating as Peachy.co.uk), sent out an email referring to the forthcoming British withdrawal from the European Union (Brexit). The email implied that a financial loan may be prudent, suggesting that there may food shortages and that it may be necessary for individuals to have a “stockpile”. The email contained bold text proclaiming, “in case of emergency press here”, with the main part of the email stating: “… no one really knows what’s going on with this whole Brexit malarkey … and some say it could affect the amount of food available … We do not want to believe that Brexit will impact the amount of food available but it’s still a good idea to have a little stockpile ready. That way you’re always prepared for the worst … Things can pop up even when you think everything is going swimmingly … That’s when you might need a little extra help”. In small text, the email noted “[w]e’ll never tell you to take a loan – credit decisions should only be made after careful consideration”.

An anonymous complainant referred the email to the British Advertising Standards Authority (ASA), “the independent regulator of advertising across all media”, on the grounds that the advertising email “irresponsibly encouraged people to take out a loan by playing on their fears”.


Decision Overview

The issue before the ASA was whether the advertisement had infringed the British laws on responsible advertising and promotional marketing.

Peachy.co.uk defended the advertisement, arguing that their intention had been to promote their service of high-cost, short-term credit loans as being “primarily of benefit to those temporarily in need of money to cover occasional unexpected shortfalls”. The company acknowledged that these forms of loans were “not suitable as a means of resolving financial difficulties”, but that the advertisement responded to the “uncertainties of every-day life where sometimes unfortunate events will impact on individuals without savings”.

Peachy.co.uk submitted that its advertising campaign had been interpreted differently to how it had been intended. The company argued that its reference to Brexit was light-hearted and to make the advertisement topical and that because the email said that the company did not think Brexit would actually lead to food shortages it did not believe that the advertisement “suggested that customers should take out a loan because of uncertainties related to Brexit”. Peachy.co.uk stressed that it had included the encouragement that credit decisions should only be made after careful consideration.

Peachy.co.uk expressed its regret that individuals had not interpreted the email in the light-hearted manner in which it had been intended and said that it would no longer use the advertisement. The company noted that it would “ensure they considered public sensitivities more thoroughly” in the future.

The ASA held that the email advertisement violated the UK Code of Non-broadcast Advertising and Promotional Marketing (the CAP Code) (edition 12) rules 1.3 on irresponsible advertising and 4.2 on harm and offence.

Rule 1.3 states that “[m]arketing communications must be prepared with a sense of responsibility to consumers and to society” and rule 4.2 states that “[m]arketing communications must not cause fear or distress without justifiable reason; if it can be justified, the fear or distress should not be excessive. Marketers must not use a shocking claim or image merely to attract attention”.

The ASA noted that Peachy.co.uk’s product of high-interest, short-term financial loans was a product that consumers should only obtain after careful consideration and that marketers of these products should “take care to advertise such products responsibly”

The ASA noted that recipients of the email would recognize that Brexit was a topical but contentious subject and that there was uncertainty over the availability of essential products and the general economic stability following Brexit. It acknowledged that the tone of the advertisement was light-hearted and “did not use definitive language regarding the future” and did include the notice that credit decisions should “only be made after careful consideration”.

However, the ASA held that the advertisement’s references to possible food shortages related to Brexit were likely to play on some consumers’ concerns – especially “financially vulnerable consumers who were already struggling or worrying about their financial situation”. Accordingly, the ASA held that “the overall approach used was likely to put emotional pressure” on the recipients of the email by implying that the sensible way to respond to Brexit’s uncertainty was to take out a loan because without taking this financial step they “risked being unable to feed themselves or their families”.

The ASA concluded that Peachy.co.uk’s emailed advertisement was irresponsible. It ordered that Peachy.co.uk not use the advertisement in the same form in the future, and that the company ensure that any future advertisements “did not send an irresponsible message about debt” by putting emotional pressure on them to take out short-term loans.


Decision Direction

Quick Info

Decision Direction indicates whether the decision expands or contracts expression based on an analysis of the case.

Contracts Expression

The Advertising Standards Authority ordered that high-interest, short-term loan companies putting “emotional pressure”on consumers through advertising – even if that advertising was “light-hearted” – sent out irresponsible messages about debt.

Global Perspective

Quick Info

Global Perspective demonstrates how the court’s decision was influenced by standards from one or many regions.

Table of Authorities

National standards, law or jurisprudence

  • U.K., Code of Non-broadcast Advertising, Sales Promotion and Direct Marketing (CAP Code), 2010

Case Significance

Quick Info

Case significance refers to how influential the case is and how its significance changes over time.

This case did not set a binding or persuasive precedent either within or outside its jurisdiction. The significance of this case is undetermined at this point in time.

Official Case Documents

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