U.K. Government Investigating Groupon Ad Practices

Concerns Include Unfair Promotions and Exaggerated Savings

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Groupon, 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 looking into 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 on Nov. 3, selling 35 million shares at $20 each, the biggest IPO by a U.S. internet company since Google first sold shares in 2004. Groupon rose 8.3% yesterday to $18.95 in New York trading. "

We are constantly evolving [the] 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."

--Bloomberg News

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