Marty Silk Australian Associated Press

Struggling Wagga Wagga mother of five Casey Simpson paid Radio Rentals $3320 for a used bed worth $480 and she still doesn’t own it.

Ms Simpson, who is leading a $50 million class action launched by Maurice Blackburn lawyers against Radio Rentals on Wednesday, claims its “Rent, Try, $1 Buy” contract misled her.

She says instead of letting her buy the used bed for $1 when her 18-month contract ended, the appliance rental giant continued to deduct weekly payments from her Centrelink account.

“That could come in handy for me and my children, I could have done a lot with that money,” she said.

“I think it’s a big scam, from the start when I signed the contract.”

Radio Rentals is owned by ASX-listed Thorn Group, which suffered heavy slide in its share price on Wednesday after news of the class action broke.

Thorn issued a statement saying it was yet to be served with any statement of claim related to its “past lending practices” so it could not comment.

“Should any proceedings be commenced, they will be defended vigorously,” the company statement said.

Details of the $1 buy offer are on the Radio Rentals website.

The website tells potential customers that at the end of a 24, 36 or 48 month rental plan for an appliance or piece of furniture: “you can make it yours for just $1”.

Maurice Blackburn principal Ben Slade said that was not correct, as customers do not automatically get to buy their rented items outright for $1.

Mr Slade said the contract fine print stated that instead the impetus is on customers to negotiate to buy rented appliances or furniture for a price agreed by Radio Rentals.

If customers fail to secure a purchase, their contracts automatically roll over into another 24, 36 or 48 month term.

“Here we have a national company that deals with vulnerable people promising them one thing but signing them up to another, at a much higher price than is reasonable,” he said.

“It’s not rent, try, one dollar buy, it’s rent now, pay forever.”

Additionally, Radio Rentals’ website states that goods available to buy under those contracts “are similar to (the) rented good in age, dimension and features”.

Mr Slade estimates that up to 200,000 Radio Rental customers are eligible to join the class action with Ms Simpson.

He said under Australian consumer law, contracts must be fair and companies must not act in a manner that misleads or deceives.

Mr Slade said if Radio Rentals’ advertising stated that customers could pay up to seven times the value of a rented product, it would not be misleading but consumers would avoid it.

“Would I think that was a sensible product? No. Would the community think it was a sensible product? No. They would say it was stupid and they would not go anywhere near the shop,” he said.

Thorn Group shares closed down 17.5 cents, or 11.7 per cent, at $1.32.