NCT Hit Debt Counsellor With R500 000 Fine
R500 000 Fine Just The Start of This Debt Counsellors’ Troubles?
Debt Counsellor Mr Clark Gardner (of Summit Financial Partners fame), has been raked over the coals by the National Consumer Tribunal (NCT).
The National Credit Regulator (NCR) launched an investigation into Mr Gardner in 2016 and decided to take the matter to the NCT due to practices by the Debt Counsellor that they felt were not allowed by the National Credit Act and Debt Counsellor’s T&Cs of registration.
Over the years, Mr Gardner says he and the NCR have had a strained relationship as he has called on them to take a more active role in protecting consumers. The NCR and Mr Gardner (of Summit) have even been on opposite sides of legal cases in regard to other NCA related matters, where Summit felt consumers were being abused by credit providers.
The NCT ruled in favour of the NCR and said that Mr Gardner had used misleading advertising promising specific reductions in debt repayments (eg. up to 50%); overcharged fees (the NCR has a fee ‘guideline’ since the National Credit Act and regulations does not have one); did not update the NCR on their Debt Help system speedily enough (or by himself) and did not make determinations personally about consumers and if they qualify for debt review (presumably they felt that some staff had perhaps helped do this).
They also felt that Mr Gardner had not explained the consequences of debt review fully to consumers who he was helping (some must have been confused or felt they did not know what was happening).
‘the NCT issued a big fine of R500 000 against Mr Gardner’
As a result of the above breaches, the NCT found in favour of the NCR’s view and issued a big fine of R500 000 against Mr Gardner.
Auditing All the Clients
A massive task now lies ahead which could see more funds being paid back to up to 4500 consumers. The NCT ordered that Mr Gardner appoint an auditor who must go through each clients matter and see if any have been overcharged.
The Auditor will report back to the NCR and refunds may follow.
Mr Gardner and Summit have long been seen as a serious thorn in the side of many big credit providers and a champion of the consumer. Mr Gardner says they are now considering taking the matter (or at least some of the points) on appeal.
‘Mr Gardner says they are now considering taking the matter…on appeal’
Recently, Summit have been able to assist 145 000 other consumers via other (non debt review) debt relief options. Mr Gardner says this is because there is still a need for debt review to further evolve from the old 2015 task team agreements, in order to help consumers who face current debt challenges. He is hoping the country’s High Courts could have the appetite to look into such needed adjustments and refinements.
Please note: Debt Counsellors are registered with the National Credit Regulator in their personal capacity (unlike credit providers, credit bureaus, PDAs). A company cannot be in breach of the NCA in regard to Debt Counsellor functions (unless there are people at the company trying to act as Debt Counsellors without being registered with the NCR, then the NCR can take the people to the NCT).