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NZ finance companies in court for illegal repossessions

Wednesday, February 25, 2015 - Posted by Philip Harvey

In New Zealand, two finance companies have had criminal proceedings commenced against them in the Auckland District Court for alleged illegal repossessions.

The Commerce Commission in New Zealand commenced the action for alleged breaches of the New Zealand Fair Trading Act. The finance companies,  Budget Loans Limited and Evolution Finance Limited are charged with misleading debtors including:

  • Advising defaulting debtors they had less time to remedy defaults before goods are repossessed that what the law actually permits.
  • Repossessing property they had no right to repossess.
  • Threatening to repossess property they had no right to repossess.
  • Instructing debtors to make repayments above what the Court has set.

By way of background, Budget Loans in 2010 has already admitted to 34 charges of breaching the NZ Fair Trading Act and made an agreement to repay substantial amounts as well as a NZ$30K Court fine.

In an Australian context, any lender practicing these debt collection methods would likely run foul of the regulator.

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