Story image

Two Auckland mobile traders fined $171,500 for contract failing

16 Jun 16

Two mobile traders have been fined $171,500 in the first sentencing under the strengthened Credit Contracts and Consumer Finance Act 2003 laws.

Goodring Company was fined $98,000 for breaches while Betterlife Corporation was fined $73,500.

The two Auckland companies sell consumer goods, including electronics, on credit at ‘significantly’ higher prices than mainstream stores. One Betterlife customers purchased an iPhone 5C for $2401, when the Commerce Commission says the phone typically retails for around $600.

As reported by ChannelLife in April, the traders pleaded guilty to the charges brought by the Commerce Commission.

Goodring plead guilty to 28 charges while Betterlife plead guilty on six.

The Commerce Commission says both companies failed to provide borrowers with the legally required information and the information was also not provided in a clear and concise way, as required by the Act, which was strengthened last year.

In sentencing in the Auckland District Court, Judge Sharp said both companies terms and conditions suffered from ‘serious and significant deficiencies’ and accepted that they would have been extremely difficult or impossible for the debtors to read or understand.

Mary-Anne Borrowdale, Commission general counsel, says the Commission regarded the conduct of Betterlife and Goodring as serious because of the deficiencies in their loan contracts.

“Although the penalties given in this case were more than previously, we are considering whether they are adequate to address the non-compliance that we are seeing,” Borrowdale says.

She warned that the consumer watchdog has a ‘good number’ of other court cases and 14 ongoing investigations into mobile traders underway..

“These companies sell high priced goods to vulnerable consumers on credit in order to fund the purchase,” she says.

“We have found that a concerning number of mobile traders and lenders do not comply with the law, and we are taking action to change that,” she adds.

The Commission has prosecuted six mobile traders this year, including the latest two.

In February Flexi Buy was fined $50,000, with $3480 awarded in damages to customers. Ace Marketing plead guilty and is expected to be sentenced in July, while Macful International appeared in court this week on 21 charges. The sixth trader is yet to appear in court.

CERT NZ highlights rise of unauthorised access incidents
“In one case, the attacker gained access and tracked the business’s emails for at least six months. They gathered extensive knowledge of the business’s billing cycles."
Report finds GCSB in compliance with NZ rights
The Inspector-General has given the GCSB its compliance tick of approval for the fourth year in a row.
Cisco dominates record-high Ethernet switch & router markets
While the market is flourishing, it’s tough-going as Cisco has increased its majority share of the pie.
Preparing for e-invoicing requirements
The New Zealand and Australian governments are working on a joint approach to create trans-Tasman standards to e-invoicing that’ll make it easier for businesses in both countries work with each other and across the globe
SAP provides partners with free access to their cloud platform
“Now that over 3,700 SAP partners have joined our cloud strategy, the free resources will help them accelerate application development."
Company-X celebrates ranking on Deloitte's Fast 500 Asia Pacific
Hamilton-based software firm Company-X has landed a spot on Deloitte Technology’s Fast 500 Asia Pacific 2018 ranking - for the second year in a row.
Gartner names Proofpoint Leader in enterprise information archiving
The report provides a detailed overview of the enterprise information archiving market and evaluates vendors based on completeness of vision and ability to execute.
WatchGuard appoints new channel distributors in A/NZ
The appointments will enable WatchGuard to expand its regional channel reseller footprint.