Inside Harvey Norman’s $35m lesson in consumer finance marketing

Australia’s Federal Court has delivered the largest penalty its corporate regulator has ever secured for misleading conduct involving financial products, ordering retail giant Harvey Norman and its longtime lending partner Latitude Finance Australia to pay a combined $55 million fine. Harvey Norman shares fell after Justice O’Bryan handed down the ruling, capping a legal fight that began when the Australian Securities and Investments Commission (ASIC) sued the ASX-listed pair in October 2022. What the ads got wrong The case centred on a nationwide campaign that ran from January 2020 to August 2021, blanketing newspapers, radio and television with a pitch for a 60-month interest-free, no-deposit payment plan on Harvey Norman purchases. ASIC argued the advertisements obscured a critical detail: customers had to apply for and be approved for a credit card, specifically the Latitude GO Mastercard, to access the offer. That card carried monthly account service fees and, until 15 March 2021, an establishment fee, which the court found were not adequately disclosed. The numbers illustrate the stakes for ordinary shoppers. Consumers who signed up for a GO Mastercard between March and August 2021 and stretched a Harvey Norman purchase across the full 60 months were on the hook for at least $537 in fees beyond the purchase price. ASIC first won on liability in October 2024, when Justice Yates found both companies had breached the ASIC Act, a finding the Full Federal Court unanimously upheld in September 2025 after dismissing what it called “barely arguable” appeals. Why Harvey Norman paid more Although the court found Latitude and Harvey Norman equally responsible for the misleading advertising, the penalties were unevenly split: $35 million for Harvey Norman and $20 million for Latitude. The gap traces directly to the conduct after the fact. Latitude overhauled its compliance systems and apologised to affected customers. Harvey Norman, by contrast, showed what the judge called a markedly different level of contrition. Justice O’Bryan pointed specifically to comments executive chairman Gerry Harvey made to The Sydney Morning Herald after the 2024 liability ruling, including his remark that “the whole legal system is completely f–ked in Australia,” and his suggestion that big businesses simply “take a hiding” without real consequence. The judge found those statements evidenced “a lack of contrition and a lack of concern about the prospect of consumers being misled,” concluding that “a higher penalty is warranted to deter repetition and to motivate Harvey Norman to improve its compliance processes”. The numbers behind the penalty Justice O’Bryan noted that the financial benefit both companies derived from the campaign was likely only around $5 million, yet he still opted for penalties well above that figure. Both fines nonetheless landed below what ASIC had sought out: $50 million from Harvey Norman and $35 million from Latitude. A five-year injunction ASIC had requested was dismissed, though the judge warned the court would not hesitate to impose steep penalties if either company reoffends. Both companies must also publish an adverse publicity notice on their websites for 90 days. This is not Harvey Norman’s first brush with advertising enforcement. The retailer paid $1.25 million in 2011 over a misleading catalogue, and various franchisees have separately drawn ACCC penalties over deceptive sales tactics. The ruling also extends a broader crackdown on retail credit products, following ASIC’s $15 million penalty against ANZ over credit card conduct and scrutiny of American Express’s card sales through David Jones. Market and corporate response Following the decision, Harvey Norman issued a statement to the ASX saying it “did not intend to engage in false, misleading or deceptive conduct” and apologised “unreservedly to the Court and customers,” while noting it had already accrued $16.2 million toward the expected penalty in prior years. Harvey Norman has foreshadowed an appeal, even as ASIC Chair Sarah Court framed the outcome as “a strong warning to the market about truthful and transparent advertising,” insisting consumers were entitled to know an offer “involved more than simply paying off a purchase in 60 instalments”. The post Inside Harvey Norman’s $35m lesson in consumer finance marketing appeared first on Inside Retail Australia.