Truck shop Flexi Buy has been fined $50,000 by the Auckland District Court with a further $3408 awarded in damages to affected customers, in the first conviction of a mobile trader since the Commerce Commission’s investigation into the industry last year.
The company, which is no longer trading, previously sold electronic and household goods such as smartphones and televisions door-to-door on credit at inflated prices. The good were sold in a number of predominantly lower socio-economic areas around the North Island including south Auckland, Whangarei, Tokoroa, Porirua, Kaikohe, Hastings and Gisborne.
Flexi Buy was charged under the Credit Contracts and Consumer Finance Act for failing to provide adequate disclosure to customers on key information about their credit contracts including the frequency and amount of payments, default interest, and the debtors cancellation rights.
Flexi Buy was also accused of describing some key information in a misleading or deceptive way with a number of customers claiming to have not received goods they had paid for.
In sentencing, Judge Chris Field said the company had been entirely reckless in its dealings with members of the public”.
In September the commission filed charges under the Crimes Act and Fair Trading Act against former Flexi Buy director Bikram Mehta, alleging he obtained money from customers by deception and accepting payment from customers without intending to supply the goods they contracted to purchase.
Mehta has pleaded not guilty to the charges and is due to reappear in the Auckland District Court on March 22.
Companies Office records show Flexi Buy is owned by Dunedin-based Rishi Bhatia.
The Commerce Commission has three other cases before the courts involving mobile traders and investigations under way into four others.
It’s mobile trader report published last August after a year-long investigation into the industry found that 31 out of 32 mobile traders identified did not comply with their legal obligations.
~Fiona Rotherham, Business Desk, NZ Herald
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