A Palmerston North man has been fined $5000 for failing to disclose his trader status when selling items regularly on Trade Me.

Bilal Shurab was sentenced in the Palmerston North District Court yesterday on three charges under the Fair Trading Act for failing to disclose his trader status when selling items on the internet, and for selling an unsafe cot.

An amount of $3500 of the total $5000 fine was for two charges relating to selling the unsafe cot.

Shurab was found to have supplemented his income by listing more than 1300 items for sale on Trade Me between November 2016 and April 2017 but failed to disclose that he was actively "in trade".

The items he sold were mostly second-hand household items, including cots.

This is the first time the Commission had taken a prosecution for failing to disclose 'in trade' status with past offenders given infringement notices.

Commerce Commission consumer and competition general manager Antonia Horrocks said this case should act as a warning to online sellers.

"Those who sell on online marketplaces that they must comply with product safety requirements, and if they are prolific sellers they must alert prospective customers that they are selling 'in trade'," Horrocks said.

"Traders must declare their status to consumers so that consumers know they are protected by the Fair Trading Act and the Consumer Guarantees Act and can exercise their rights."

In March 2017 Shurab listed a cot under the heading "baby Cot with 2 mattresses". The commission received a complaint about the safety of the cot and advised Trade Me which removed the listing.

He claimed the cot was a bassinet and therefore not covered by the relevant safety standard. Within a few days, Shurab re-listed the cot as "Bassinet/Baby cot with 2 mattresses".

The commission bought the cot and sent it for testing. It was found to be unsafe with the risk of a child being able to climb or fall out of the cot, become smothered or strangled.

James Ryan, team leader of policy and compliance at Trade Me, said the online marketplace kept an eye out for sellers who may be breaking the law but it did not vet or pre-approve listings.

"We take our obligations to provide a safe and trusted marketplace extremely seriously," Ryan said.

"People who breach our rules, and the law, will face the consequences and we hope this deters anyone else who is contemplating doing something similarly dodgy."