Groupon Advertising Practices Being Probed in U.K. on Promotions, Savings

Groupon Inc., the largest Internet daily-deal site, is being investigated by Britain’s competition regulator over concerns including unfair promotions and exaggerated savings.

The U.K. Office of Fair Trading has been investigating Groupon’s British unit since July and expanded the probe after receiving a complaint from the country’s advertising watchdog.

“Given Groupon’s track record, we have serious concerns about its ability to adhere to the advertising code,” the Advertising Standards Authority said in a statement. “It is in the public interest that we refer the matter to the OFT.”

Groupon, based in Chicago, raised $700 million selling 35 million shares at $20 each on Nov. 3, the biggest IPO by a U.S. Internet company since Google Inc. first sold shares in 2004. Groupon rose 8.3 percent yesterday to $18.95 in New York trading.

“We are constantly evolving business process to ensure customers receive the best possible experience at the highest standards,” a Groupon spokesperson said in an e-mailed statement. “We are cooperating fully with the OFT to ensure that the rights of consumers are protected.”

To contact the reporter on this story: Erik Larson in London at elarson4@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net

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