Truck shop fines net $1m
A Commerce Commission crackdown on truck shops has resulted in almost $1 million in fines.
Two mobile traders are the latest to be fined, having been handed total fines of more than $183,000 and ordered to return nearly $71,000 in fees to customers.
The sentences bring to just under $882,000 the total fines imposed by the courts so far in the Commerce Commission’s prosecutions against mobile traders.
The commission has been working in the sector since it launched a report in 2015, which highlighted widespread problems.
Its staff visited 32 mobile traders, or truck shops, around New Zealand and found all but one, Home Direct, were not complying with their obligations under the Fair Trading Act and the Credit Contracts and Consumer Finance Act.
‘‘Thirteen prosecutions are now completed or before the courts, and the growing total in fines shows the seriousness with which the courts and the commission regard this sort of offending,’’ said Commissioner Anna Rawlings.
In the latest proceedings, Manukau-based Budget Warehouse was fined $100,000 in the Auckland District Court, after pleading guilty to 18 charges relating to its customer contracts.
The court also ordered that $33,419 in fees must be returned to customers.
Budget Warehouse operated five trucks in the Auckland and Hamilton regions, selling household goods on credit. The company failed to disclose the required information in its contract documents, including its full contact details and an accurate statement of the customer’s right to cancel.
Many contracts failed to accurately disclose payment details, including the total number and amount of payments, and the date of the first payment.
Budget Warehouse’s contract documents also misled customers about delivery guarantees and its liability for loss or damages caused by the products sold.
In sentencing, Judge Down said the offending involved a high degree of negligence, and ‘‘it is not surprising that the Commerce Commission seeks to send out a strong message through this sentencing exercise‘‘.
Best Buy was fined nearly $83,400, also in the Auckland District Court, on 16 charges relating to its credit contracts. Best Buy’s contracts were unclear and left out important information.
The court also ordered that $37,180 in fees be returned by Best Buy to its customers.
Best Buy operated a mobile trader business in Auckland and North Island towns.
Best Buy’s contracts did not disclose information such as accurate payment details, and the right of the customer to apply for relief on grounds of unforeseen hardship.
The first contract version was also likely to mislead customers into wrongly thinking that Best Buy had a right to repossess the goods being purchased.
In sentencing, Judge Gibson said Best Buy’s failures were ‘‘widespread and systemic’’ with a ‘‘high degree of negligence’’.