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2 August 2016

Pre-approval letters land Harmoney in court

500,000 Kiwis were told they were pre-approved for a loan.

The Commerce Commission is taking peer-to-peer lender Harmoney to court, alleging the company’s marketing campaign misled consumers and breached the Fair Trading Act.

Harmoney faces six charges under the Act relating to letters it sent to 500,000 consumers telling them they’d been pre-approved for a loan.

The commission says the letters, sent out between October 2014 and April 2015, told recipients they had to visit Harmoney’s website to find out how much money they had pre-approval to borrow. There were 27 versions of the letter.

But once on the website, letter recipients found they had to go through the normal process of applying for a loan, including passing the approval process.

The commission says Harmoney has co-operated with the investigation and indicated it would plead guilty to the charges.

See our article on Harmoney’s use of Credit Sense, a bank statement retrieval service that requires customers give it power of attorney to access their accounts.

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