Mobile trader Appenture Marketing has been fined $114,000 in the Auckland District Court for misleading consumers about their rights and failing to provide key contract information, says the Commerce Commission.
Appenture Marketing was a mobile trader based in Auckland and operating throughout the North Island.
The charges related to conduct between June 2015 and April 2016. Appenture was charged in December 2016 and went into liquidation in April 2017. The Commission said it then sought consent from the High Court to continue the prosecution.
"In the Commission's view there was genuine public interest in pursuing this prosecution despite the liquidation, as conviction may lead to the return of funds to consumers. It's also important for deterrence," said Commissioner Anna Rawlings.''
Judge Mary-Beth Sharp in sentencing said "it is most unlikely these fines or any part of them will be met".
However, she said "this case must have the effect of denouncing the conduct and penalising it in such a way that others in this industry will think twice before offending".
Appenture was sentenced on 18 charges under the Fair Trading Act 1986, and six charges under the Credit Contracts and Consumer Finance Act 2003 (CCCFA).
"Appenture represented in its terms and conditions to its customers it wasn't liable for delivery delays and customers would not be able to cancel because of delays," Rawlings said.
"That's misleading because the CGA [Consumer Guarantees Act] guarantees that goods will be received within the agreed time, and the trader could not contract out of its obligations under the CGA."
The commission said Appenture also misled customers by representing that if purchased goods were unavailable it could substitute other goods for them, and that it could charge default interest on the unpaid balance of a contract after the goods had been repossessed and sold.
"The CCCFA is clear that creditors cannot charge interest on the outstanding balance after goods have been repossessed and sold," Rawlings said.
Appenture's contracts failed to disclose key information to consumers, such as the correct initial unpaid balance, the amount of the final payment, and the number of payments to be made, the commission said.
"This trader failed to comply with its obligations under the CCCFA and the FTA and deprived its customers of the information and legal protections that the law provides".
Appenture was not among the traders identified in the commission's Mobile Trader 2014/15 Report. It was identified later as part of its ongoing review of the industry.
The sentencing brought the total in fines against mobile traders in 12 completed prosecutions to just more than $1.23 million.