Rudco fails to repay lenders before
NCR deadline
November 3, 2007
By Laura du Preez
Rudco, the company that has been attracting a lot of interest by
advertising home loans with an interest rate of six percent fixed
for 20 years, this week failed to repay money it collected from
would-be lenders in contravention of the National Credit Act (NCA)
and the Usury Act, as it was instructed to do by the National Credit
Regulator (NCR).
The NCR had already referred the matter to both the National Prosecuting
Authority (the Scorpions) and the National Consumer Tribunal, the
body set up to adjudicate in cases where credit providers contravene
the law. This week, at a pre-trial conference at the tribunal, a
new repayment deadline of November 22 was set, the NCR's Advocate
Jan Augustyn says.
Rudco is obliged to give the NCR a report on its progress towards
repaying some 1 800 people who applied for its debt consolidation
loans by November 13. The tribunal will reconvene on November 23.
In August, the NCR issued a compliance notice to Rudco stating
that it had taken monthly service fees and loan repayments from
consumers who applied for its debt consolidation loans before advancing
these loans and that this was in contravention of the NCA and the
Usury Act.
In addition, the NCR said the company had charged loan applicants
monthly fees in excess of the prescribed R57 a month, its advertisements
were misleading and it had not provided consumers with quotes for
its loans as required in terms of the NCA.
The NCR ordered Rudco to stop taking repayments and fees before
loans had been advanced and to repay loan applicants the amounts
it had collected from them in contravention of the law.
Apparently, Rudco has been collecting repayments from loan applicants
to establish whether they are disciplined repayers for up to nine
months and has only in some cases provided funds to settle some
of the applicants' existing debts and consolidate these into a single
loan.
- Manie van Schalkwyk, the Credit Information Ombud, announced
this week that the black-listing amnesty has been extended.
If you have an outstanding judgment against you from before September
2006 of less than R50 000 and you repay the amount before December
31 this year, the judgment information will be removed from your
records with the credit bureaus.
(Persfin,
3 November 2007)
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