The Commerce Commission is investigating a truck shop over what it says are serious breaches of the law.

It has also issued 15 truck shops with formal compliance advice letters, which are used when the commission believes a company’s behaviour may breach the Fair Trading Act but the matter isn’t a priority for taking further.

Consumer NZ recently wrote about how truck shops are targeting some of the country’s most vulnerable customers.

The commission said truck shops used a business model based on selling goods on credit at higher prices, but typically didn’t charge interest. It gave the example of a pair of shoes that cost $70 in a shop but $260 if bought from a truck shop and paid off at $10 a week over 6 months.

The commission hasn’t named the truck shop business it’s investigating.

The commission obtained documentation to review from 23 truck shop companies. It has an additional 15 truck shops to review before new credit laws take effect on 6 June but said concerns about disclosure of fees, start and end dates of payments and the total price a customer would pay, had been identified. It was also concerned some customers weren’t informed they had a right to cancel the agreement.