JD Group Get Into Trouble With The NCR

NCR Refer JD Group to the NCT

Is it alright to charge pensioners for insurance they can never claim on? Recently the NCR told Lewis Stores that it was not and referred them to the National Credit Tribunal (NCT) for a R10 million fine. It seems this then made the NCR aware of a problem that may be happening industry wide. They have now begun to roll out investigations across this part of the industry. Next stop for the NCR was JDG Trading Ltd and their insurance arm, JDG Micro Life Ltd.

The NCR have now referred JDG to the National Credit Tribunal because they found that they have been charging pensioners occupational disability cover. It seems that even consumers on government social grants (eg disability or child support) have been asked to pay for this type of insurance which they could never use.

Pay Back The Money

The NCR have asked that the NCT order JDG to repay the amounts in question to the consumers (any since 2007, when the National Credit Act came into effect). This will require an extensive audit and involve a lot of money.  When Lewis Stores were hit with this type of regulatory action (while undergoing a media war regarding the Mystery Shopper incident) their share prices first dipped by 6% and then plummeted by almost half their value in a few days.

 Ongoing Investigations

The NCR say they are commented to rolling out this particular type of investigation and enforcement industry wide. As such, creditors need to launch their own internal investigations to try get out ahead of it.