Sydney radio cop a $360,000 fine in covert advertising breach

The Federal Government's regulatory body, Australian Communications and Media Authority, has sent a $360,000 fine to Radio 2UE for the infamous cash for comments breach on John Laws radio show.

They were fined for breaches of the disclosure rules when endorsing or advertising a product or service where money was paid to the radio station. It took ACMA 18 months to deliver this decision, showing a weak-handed approach from a station with a history of such behaviour.

ACMA says this is the first civil penalty heard under the Broadcasting Services Act 1992 for breaching a condition of a broadcasting licence.

I dare say that Steve Hirst, station manager at 4CA will be carefully watching his staff and what is said on air from now on. The Disclosure Standard requires licensees to disclose the existence of commercial sponsorship arrangements between presenters and sponsors.

Mike 'Locco' O'Loughlin morning presenter at 4CA told me that they are now very careful how advertorials are presented, following the spotlight of Council's covert advertising deal.

"We welcome the decision of the Federal Court. 2UE repeatedly breached its obligations under the Act, even after giving ACMA an enforceable undertaking, committing itself to improve compliance,’ Chris Cheah of ACMA said.

"The court has confirmed that in matters involving serious contraventions, a substantial civil penalty is an appropriate sanction."

• In September 2007, 2UE gave the ACMA an enforceable undertaking, which included undertakings that the John Laws Morning Show would be monitored to ensure compliance with the Disclosure Standard and 2UE would take action if disclosure announcements were not made when presenters mentioned sponsors.
  
  The undertaking was accepted by the ACMA in response to earlier breaches of the Disclosure Standard in 2006. When the ACMA assessed compliance with that undertaking and with the Disclosure Standard, it identified 13 instances in which a further breach of the Disclosure Standard had occurred.
  
  On 9 November 2007, 2UE was sold to Fairfax Media. Since acquiring 2UE, Fairfax Media has cooperated with the ACMA and has actively sought to improve compliance with its broadcasting obligations.
  
  In November 2008, the ACMA and Fairfax Media agreed on a quantum of penalties that would be presented to the court for its approval in relation to the breaches of the Disclosure Standard during the John Laws Morning Show. The court was asked to accept as appropriate, a penalty of $10,000 for each breach that had been identified and admitted by 2UE as being a breach of the Disclosure Standard.
  
  The court directed the Communications Law Centre to intervene in the proceedings to make submissions on the public interest issues.
  
  Taking into account the submissions of the intervener and the factors to be considered under the BSA, including 2UE’s admission of liability and introduction of a new compliance program the court decided to impose penalties of varying amounts totalling $360,000.

The Disclosure Standard is a condition that applies to all commercial radio broadcasting licences.

The investigation into Cairns Radio 4CA over the non-disclosure of a secret Council advertising arrangement that allowed the Mayor to speak on John Mackenzie's show, is is yet to be presented.

The fiasco resulted in the sudden resignation of former CEO Noel Briggs and the imminent termination of Council's Communications Manager Kerie Hull, who has not been back to work for a month, yet is still being paid. It also exposed a culture of internal disloyalty by Councillors Sno Bonneau and Alan Blake.

• Full CairnsBlog coverage of the Cash for Comment investigation.