Kiwipure has operated in New Zealand since 2006, selling water filtration systems that use magnets.

A water filtration company has been fined $162,000 for making unsubstantiated claims about the benefits and effectiveness of its systems.

Kiwipure has operated in New Zealand since 2006, selling water filtration systems that use magnets.

In October 2018, HRV Clean Water was fined $440,000 after it pleaded guilty to making misleading claims about the Kiwipure water filters.

Kiwipure's case was the first defended case in New Zealand taken against a trader accused of unsubstantiated representations.

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It was found guilty on seven charges.

Kiwipure claimed the benefits of its "world's first" magnetic water filtration system were "scientifically proven". But it did not test its product using reliable scientific methods; instead it relied on anecdotal evidence and assumptions when making the claims.

Kiwipure claimed that a magnetic "virtual ionizer" in its water filtration system softened water. The benefits that consumers could expect of soft water after using the water filter, were "no scum build up", "use less washing powder" and "no scale build-up in hot water systems and pipes saves electricity and maintenance".

Use of the water filter would lead to a "reduction in skin irritations and eczema", it said.

In sentencing in the Auckland District Court, the judge said there was a reasonably high degree of carelessness in the case.

SUPPLIED Commerce Commission chairwoman Anna Rawlings says Aotea Finance failed to reveal all required information to borrowers.

"The need to have the product scientifically tested ought to have been obvious and there was a conscious decision not to do that".

Commission chair Anna Rawlings said it set an important precedent for the commission.

"Businesses must be able to back up any advertising claims they make about goods and services at the time they are making them. This means having evidence, research, test results, consumer surveys or similar credible information to demonstrate that their claims have a solid foundation. Traders are not permitted to advertise using guesses, supposition, anecdotal evidence, assumptions and unsupported opinions.

"Consumers are entitled to rely on trader claims when making purchasing decisions. This is especially true when customers cannot test or establish the truth of claims for themselves, like in this case where Kiwipure claimed that scientific processes existed by which magnets could treat tap water and improve health outcomes. If you can't back it up – don't say it."," said Ms Rawlings.

Hard water is the term used to describe water containing high levels of minerals. Conventional methods of treating hard water (reverse osmosis and ion exchange) involve removing the minerals from water which cause it to be hard. The result is softer water and reduced scale, or scum build up.

The commission said consumers had to be able to rely on the accuracy of claims.