Background
Summary of Council decision:
Three issues were investigated, all of which were Upheld.
Ad description
A website and an e-mail for tenancy fraud prevention system HomePPL:
a. The website www.homeppl.com, seen on 18 July 2022, featured a page titled “Fraud Prevention & Financial Qualification Technology” that stated “the rewarding upside to our thorough fraud prevention technology is that we can approve 25% rental applications than any of our UK competitors [sic]. Outdated credit and referencing checks with high rejection rates have lead [sic] to approximately 5 million tenants … falling through the cracks. Our unique technology is so advanced we can assess the true validity of these tenants making these invisible applicants visible again. We help more people rent on fairer terms”.
b. The e-mail, received on 11 August 2022, had the subject line “We’ve turned up the heat on tenancy fraud this Summer" and text in the main body that stated “No other referencing company identifies tenancy fraud”. Text under that stated “Learn about how and why Homeppl are doing things differently with unique-in-market fraud detection technology”. At the bottom of the ad was a link labelled “Book a demo”.
Issue
Barbon Insurance Group Ltd challenged whether the following claims were misleading and could be substantiated:
1. the claim “we can approve 25% rental applications than any of our UK competitors [sic]” in ad (a); and
2. the claim “No other referencing company identifies tenancy fraud".
3. They also challenged whether the claims were verifiable.
Response
1. HomePPL Ltd provided referencing criteria and approval rates of Let Alliance, one of their competitors, which was part of Barbon Insurance Group, against their own approval rates. HomePPL said their approval rate for tenancy applications stood at 96%, which included students, the self-employed with less than two years trading, those new to the country, and people not found on the electoral roll. They said those groups made up approximately 22.5% of the UK’s population. By comparison, Let Alliance’s approval rate for tenancy applications stood at 75%, and did not include the aforementioned groups, since they did not approve applications from those groups. For those groups, Let Alliance provided a conditional approval – subject to the provision of a guarantor, or payment of rent upfront – or declined the application. HomePPL provided a report from Let Alliance that they said showed they had declined around 4.5% of applications in 2018 and provided documents outlining the proportion of the UK population that the groups Let Alliance only offered a conditional approval to, including the Financial Conduct Authority’s (FCA) November 2022 Credit Information Market Study, that outlined the number of people in the UK not found on the electoral roll; information that showed the number of self-employed workers in the UK between 1992 and 2022 from an extract of a report produced by a market and consumer data company; a February 2022 House of Commons Library research brief that outlined the number of students within the UK; and a November 2022 Office of National Statistics report on the 2021 census that analysed long-term migration trends until June 2022. They also provided Let Alliance’s referencing requirements, and a guide to tenant referencing from another competitor.
2. HomePPL said ad (b) was outside of the ASA’s remit since it was private correspondence that only provided additional reading to their customers. It did not promote services and did not encourage recipients to subscribe to or buy a different product or service, or take up a promotional offer.
HomePPL said consumers would understand the claim, when read with the sub-heading “Learn more about our fraud tech" and the sentence immediately following the subheading, "Learn more about how Homeppl is doing things differently with unique-in-market fraud detection technology ...", to mean no other referencing company used fraud detection technology to identify tenancy fraud. They were the only business in the industry that owned and used the technology and none of their competitors had a similar type of technology at their disposal. They provided evidence showing how their competitor HomeLet, which was also part of Barbon Insurance Group, conducted tenancy referencing. They also provided a document outlining the operation of their technology.
3. HomePPL said the evidence provided demonstrated that their claims were verifiable.
Assessment
1. Upheld
The ASA considered that consumers were likely to understand the claim “we can approve 25% rental applications than any of our UK competitors [sic]” in ad (a) as meaning that HomePPL approved 25% more tenancy applications than any of their UK competitors. We noted the claim did not specify the competitors against which the comparison was made, and we therefore considered consumers were likely to interpret it as a comparison against all other tenancy fraud prevention services. We therefore expected to see substantiation that included all of HomePPL’s competitors.
We assessed the evidence provided by HomePPL. The referencing requirements, guide to tenant referencing, FCA report, information on the number of self-employed workers in the UK between 1992 and 2022, House of Commons Library research brief, and ONS report did not compare HomePPL’s rate of tenancy application with that of all their competitors. We therefore considered they were not relevant substantiation for the claim.
HomePPL provided a report from Let Alliance that showed in 2018 they had rejected 82,000 tenant applications and completed 900,000. They said their tenancy approval rate was 96% and estimated that Let Alliance’s approval rate was approximately 75%, but had not provided information showing the provenance of those figures, or the period to which they related. Additionally, the evidence provided related only to Let Alliance, and did not cover all of HomePPL’s competitors. We therefore considered it was not adequate substantiation for the claim. We therefore concluded that the claim “we can approve 25% rental applications than any of our UK competitors [sic]” was misleading.
On that point, ad (a) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation), and 3.33 3.33 Marketing communications that include a comparison with an identifiable competitor must not mislead, or be likely to mislead, the consumer about either the advertised product or the competing product. (Comparisons with identifiable competitors).
2. Upheld
We first assessed whether or not the email was a marketing communication that fell within the ASA’s remit. The ad was an email that had been sent to HomePPL’s existing customers and those who had requested to be kept informed of their developments, and it promoted the efficacy of HomePPL’s antifraud services. At the bottom of the ad was a link labelled “Book a demo”, through which consumers could access a demonstration of the service offered. We considered the purpose of the ad was to promote the efficacy of HomePPL’s services and to encourage consumers to take up HomePPL’s offer of a demonstration, with a view to subscribing to their services. We therefore concluded the email was a marketing communication that fell within the ASA’s remit.We considered consumers would understand the claim “No other referencing company identifies tenancy fraud” in ad (b), when read with the text “Learn about how and why Homeppl are doing things differently with unique-in-market fraud detection technology”, to mean that HomePPL were the only business in the market that could identify tenancy fraud, and that they did so using technology that was unique to them.
HomePPL had provided a document outlining how their fraud prevention technology operated. They also provided some comparative information relating to their competitor HomeLet’s services. However, they did not provide comparative evidence showing they were the only company in the market able to identify tenancy fraud. We concluded that the claim “No other referencing company identifies tenancy fraud” in ad (b) had not been substantiated and was therefore misleading.
On that point, ad (b) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation), and 3.33 3.33 Marketing communications that include a comparison with an identifiable competitor must not mislead, or be likely to mislead, the consumer about either the advertised product or the competing product. (Comparisons with identifiable competitors).
3. Upheld
The CAP Code required comparisons with identifiable competitors to be verifiable. That meant an ad which featured a comparison with an identifiable competitor, including one that could be identified by implication, needed to include, or direct a consumer to, sufficient information to allow them to understand the comparison, and be able to check the claim was accurate, or ask someone suitably qualified to do so.
The ads did not provide any information to ensure consumers or competitors could verify the comparative claims made, nor did they include an adequate signpost to information that formed the basis of the comparisons. For those reasons, we did not consider that the ads allowed consumers or competitors to verify the comparisons made, and therefore concluded the claims in ads (a) and (b) breached the Code.
On that point, ads (a) and (b) breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.35 3.35 They must objectively compare one or more material, relevant, verifiable and representative feature of those products, which may include price. (Comparisons with identifiable competitors)
Action
The claims must not appear again in the form complained of. We told HomePPL Ltd to ensure they held adequate evidence to substantiate comparative claims in the future, and to ensure claims with identifiable competitors were verifiable.
