Kmart slapped with $1.3m fine for breaching spam email laws

Kmart Australia has been slapped with a $1.3 million fine for sending more than 200,000 marketing emails in breach of Australian spam laws after repeated warnings from the communications authority of concerns over the retailer’s activities.

The Australian Communications and Media Authority (ACMA) launched an investigation into the company’s activities following consumer complaints and found Kmart sent 212,471 messages to customers who had previously unsubscribed between July 2022 and May 2023.

The investigation found that the breaches occurred due to a combination of technology, system and procedural failures.

ACMA chair Nerida O’Loughlin says people are frustrated and angry with big brands intruding on their privacy by not respecting their wishes to unsubscribe.

“When a customer decides to opt out of a marketing mailing list, businesses are obliged to fulfil that request,” O’Laughlin says.

“The rules have been in place for nearly 20 years and there is simply no excuse.

"Kmart’s case is particularly concerning as it went on for such a significant period.”

Kmart was already on ACMA’s radar before launching its formal investigation, with the authority alerting the company on multiple occasions that it may have issues with its consumer marketing.

“Kmart was given more than enough notice it may have a compliance issue, and it should have done more to address its problems before we had to step in and investigate,” O’Laughlin says.

The spam rules require businesses to have consent from consumers to conduct e-marketing, and, when they receive an unsubscribe request, it must be actioned.

In addition to the financial penalty, the ACMA has also accepted a comprehensive two-year court-enforceable undertaking from Kmart committing it to appoint an independent consultant to review its compliance with spam rules and to make improvements where needed. Kmart must also report regularly to the ACMA.

“Any business that conducts e-marketing should be actively and regularly reviewing its processes to ensure it is complying with the rules,” O’Loughlin says.

This action follows recent enforcement taken against other companies that have breached the spam laws, including DoorDash, Ticketek, and Uber.

ACMA also recently accepted enforceable undertakings from Webull and The Wine Collective after they admitted they contravened the spam laws.

ACMA says enforcement of the spam unsubscribe rules is one of its compliance priorities and over the last 18 months businesses have paid more than $12.5 million in spam and telemarketing penalties.