Commerce Commission files criminal proceedings.
The Commerce Commission has filed criminal proceedings in Auckland District Court against finance companies Budget Loans Limited and Evolution Finance Limited.
The Commission has alleged the companies’ repossession and debt recovery practices breached the Fair Trading Act.
Budget Loans and Evolution Finance have been charged with misleading debtors by:
Commerce Commission Competition General Counsel Mary-Anne Borrowdale said it was concerning that Budget Loans was again facing criminal charges, having admitted 34 charges under the Fair Trading Act in 2010.
“Ultimately it is now for the Court to decide whether the evidence shows that Budget Loans’ and Evolution Finance’s conduct was illegal,” Ms Borrowdale said.
“However, all finance companies should be aware that we are paying close attention to their conduct and won’t hesitate to act if we believe they are misleading debtors about their rights and obligations.”
The directors of Budget Loans Limited and Evolution Finance Limited are Allan Hawkins and Wayne Hawkins.
Evolution Finance and Budget Loans purchased old loan books from a number of failed finance companies including National Finance Limited, Western Bay Finance Limited and Equality Finance Limited. The majority of loans originate between 2001 and 2006.
In July 2010 Budget Loans Limited admitted 34 charges of breaching the Fair Trading Act 1986 by charging interest and fees after it had repossessed and sold items of security on National Finance loans. It agreed to make substantial repayments and was fined $30,750 in the Auckland District Court.
The Commission started the current investigation into Budget Loans and Evolution Finance in 2012. The Commission issued a “Stop Now” letter to the two companies in November 2013 with regard to one aspect of their conduct while its investigation continued.