Speaking at the launch of his annual report this week, Credit Ombudsman Nicky Lala-Mohan said that the achievement his office was most proud of this year was the fact that it put more than R7.5 million – up 163% from the year before – back into consumers’ pockets.
“This amount is mostly made up of relatively small amounts, where consumers overpaid or where we found some breach of the law that entitled the consumer to a refund or recalculation of the amounts owed,” he said.
Another achievement was the number of consumers who were assisted telephonically. Despite a drop in the number of complaints, the call centre still fielded 24 255 calls, and provided telephonic advice and assistance to these callers.
The total complaints and enquiries recorded amounted to 12 312 for the period, an average of 1 026 a month. Disputes opened for investigation amounted to 4 522 for the year, a decrease of 23.2% compared with 2014, and closed disputes amounted to 5 074, a decrease of 26.2%.
“The office has found that a key factor for the drop in both calls and complaints was due to the legislation in 2014, which allowed the removal of adverse data from the credit bureaus, which gave rise to thousands more calls and cases,” said Lala-Mohan.
COMMON COMPLAINTS
Some of the most common disputes relating to credit-information cases include insufficient or incomplete credit information at the credit bureau, outdated credit information as well as credit grantors not supplying accurate information.
The most common cases from non-bank credit transactions range from disputes regarding consumers’ incorrect statements of account and so-called garnishee orders to fraud cases and alleged reckless-lending cases.
Many cases resulted in balances being written off, refunds being facilitated or consumers being helped to enter into payment arrangements.
The office resolved 67% of the disputes in consumers’ favour, signalling that consumers’ complaints were fully or partially upheld.
CASE STUDIES
1. RECKLESS-LENDING REFUND
*Nancy Zakade is the breadwinner in her family, and supports her elderly parents and her adult son. She is due to retire next year and is employed by government.
Her adult son suffers from a psychological condition and when her parents also started suffering from medical illnesses, Zakade was forced to take on two nurses to help her take care of them. She then took out several loans to help pay the bills.
Over seven months, she took out five loans to the value of R76 000 with one credit provider, but soon realised that she was unable to afford the repayments. She approached the credit ombud when the credit provider started to take legal action against her.
Lala-Mohan found that “greater consideration should have been given to her additional expenses when conducting the affordability assessments”.
Zakade also submitted a letter detailing her personal circumstances.
The credit provider agreed to write off the five loans to the value of R140 554.63 (with interest).
2. FRAUDULENT ACTIVITY
In a second case, *Amy Botha noticed a bank account with a negative listing reflected on her credit report and reported it as fraudulent. The credit ombud investigated and found several other bank accounts, also with negative listings, on her credit report.
On investigation, the banks found that the accounts had been opened fraudulently.
The information was removed from her credit profile and she was no longer liable for the R52 000 debt that had been fraudulently obtained in her name.
NO AIRTIME TO COMPLAIN? NO PROBLEM
that in these difficult financial times, some consumers simply do not have the funds for airtime for these calls,” explained Credit Ombudsman Nicky Lala-Mohan.
“That is why we decided to assist.
“If the consumer makes use of the SMS message service, the office will respond by phoning the consumer and thus pay for the call.
*Not their real names