Informed Consumers Enforcement Response Register

This register contains warnings, settlements and judgments since 1 January 2014 under the Fair Trading Act 1986 and the Credit Contracts and Consumer Finance Act 2003. It does not contain all enforcement responses before this date or enforcement responses withheld under the Official Information Act 1982. Please note that judgments will be published as we receive them from the Court. This can sometimes be several months after the relevant hearing.

Parties Act/Section Description Resolution Year
Vodafone New Zealand Ltd Between July 2009 and September 2011 Vodafone offered its Broadband Lite service free to some customers for a three month period. After the free period, the service cost $10 per month. Customers were required to opt-out of the service at the end of the free period to avoid any further costs. The Commission investigated the complaints and decided that some customers were not adequately advised of the terms applying to the service. The investigation also revealed that almost 8,000 customers did not receive the promised ‘opt-out’ reminder text and around 3,000 customers had cancelled the service but were charged for it because the Broadband Lite add-on was not removed from their accounts. These issues resulted in potential breaches of sections 11, 13(c), 13(e) and 13(i) of the Act. Settlement 2013
Eco-Pal Limited Manufacturer of plastic rubbish bags. Found guilty of 15 breaches of the Fair Trading Act and fined $60,000 in relation to environmental claims that were liable to mislead. Judgment 2013
Baycorp (NZ) Limited Likely to have contravened section 13(i) of the Fair Trading Act 1986 by claiming to have a right, on behalf of its clients, to add collection costs, some legal and court costs and interest, onto a debtor’s balance after security items have been repossessed and sold. In the Commission’s opinion, Baycorp had no legal right to do so because section 35 of the CRA prohibits a lender from recovering more than the debt balance outstanding after goods have been repossessed and sold. Settlement 2013
Pacrite Industries Limited Manufacturer of plastic rubbish bags. Fined $30,000 for breaches of the Fair Trading Act in relation to environmental claims that were liable to mislead. Judgment 2013
Hyeon Company Ltd, Premium Alpaca New Zealand Ltd, Duvet 2000 Ltd, JM Wool Ltd, Han Young Chae, Yun Duk Jung, Bo Sun Yoo, and Jong Myung Lee Four companies and four individuals convicted and fined a total of $601,900 for selling visiting Asian tourists a range of imported alpaca goods as “Made in New Zealand”, and making claims that duvets were 100% alpaca or merino wool when they were not. Judgment 2013
Mi Woolies Ltd Company fined $63,000 after pleading guilty to 10 charges of breaching the Fair Trading Act. The charges relate to false or misleading country of origin claims by the Company on its "UGG New Zealand" branded sheepskin footwear. Judgment 2013
Elderton Limited Third tier mortgage lender who has settled with the Commission after admitting breaching the Credit Contracts and Consumer Finance Act and the Fair Trading Act in relation to loans it made to four customers. Has made cash refunds of $42,000 and adjusted the balance on one continuing loan by about $55,000. Settlement 2013
Warwick Keith Nelson Taylor Auckland car dealer fined $22,000 after admitting to a number of charges including misleading customers, selling unnecessary warranties, and charging higher interest rates than those agreed. Sentencing notes to follow. Judgment 2013
The Auto Co (Millenium) Limited Company fined $42,000 after pleading guilty to misleading consumer about the price of vehicles auctioned on Trade Me. The fine is on top of over $122,000 already paid in compensation to affected consumers and related costs. Judgment 2013
Marac Finance Limited Marac Finance Limited is a finance company providing vehicle finance to consumers and businesses through a dealer network. It is a subsidiary of Heartland Bank Limited. The Commerce Commission has settled with Marac Finance Limited following the finance company’s decision to refund 1,000 customers a total of about $567,000. The refunds are to borrowers who paid their loans back early between 2006 and 2010 but were not refunded premiums for their loan repayment insurance. Settlement 2013
Haidong Chen, Jinming Chen, Top Sky Holdings Ltd and Kiwi Wool Ltd Two companies and two individuals fined a total of $259,000 for manufacturing and selling to visiting Asian tourists a range of high-priced souvenir items that were not what they claimed to be. Made misleading representations that the alpaca rugs were New Zealand made, when they were imported, and that the duvet wool content was 100% alpaca or merino when it was not. Judgment 2013
Vodafone New Zealand Limited Misleading representations in relation to the following three of Vodafone’s advertising campaigns: 1. Broadband everywhere - these charges related to the extent of the coverage of Vodafone’s 3G mobile broadband service, made between October 2006 and April 2008; 2. Supa Prepay Connection Pack - these charges related to the availability of a $10 free airtime credit for those customers who registered their details on Vodafone’s website between May 2007 and September 2008; and 3. Largest 3G Network - these charges related to the comparative size of Vodafone’s mobile phone network between September 2008 and February 2009. Judgment 2012
Chrisco Hampers Limited Misleading conduct and misrepresentations relating to customers cancellation rights. Judgment 2012
Forsyth Barr Limited, Forsyth Barr Group Limited, Credit Agricole Corporate and Investment Bank, Credit Sail Limited and Calyon Hong Kong Limited Credit SaILS were sophisticated debt securities marketed and sold to the New Zealand public in 2006 with the prospect of 8.5% interest income and capital protection. $91.5 million was raised through the offer. Credit SaILS failed in 2008 and the notes are now virtually worthless. On the information available, the Commission estimates the total loss for those eligible for a share of the settlement fund is around $70 million. As part of the settlement, the companies have agreed to create a settlement fund of $60 million to be distributed to investors who lost money when Credit SaILS failed in 2008. Settlement 2012
Barry Hunt Mr Hunt was prosecuted by the Commerce Commission in relation to 15 loan contracts he entered into between September 2006 and August 2007 with 11 different debtors. The contracts did not meet crucial conditions under the CCCF Act. Barry Hunt was fined $18,532 and ordered to pay $1,461.79 in court costs. Judgment 2012
Panasonic New Zealand Limited In November and December 2010 Panasonic ran a ‘Million Dollar Summer’ two tier prize draw promotion. The headline implied that the prize valued at $1,000,000 which featured in four separate ‘Million Dollar Summer’ promotions, would actually be won. Two-tier competitions tend to feature prizes which have very little chance of being won by anyone. This is because you have to be a winner of the first draw to earn the opportunity to make a selection from a number of options to win the final prize. In this case, the four winners (one from each of the four separate retail groups that carried the promotion) of the first draw then chose their prize randomly from 300 envelopes. Only 1 of the 300 envelopes contained the million dollar prize, with all others containing a $10,000 Panasonic prize pack. So, the odds that the million dollars would be won were remote. Settlement 2012
IAG New Zealand Limited IAG discovered an error in August 2011 while assessing Canterbury earthquake claims and advised the Commission in October 2011. The problem affects some house and contents insurance policies offered by NZI, Lantern, ASB, BNZ and Co-operative Bank. IAG miscalculated the sum insured in 643 previously paid out total loss insurance claims. The same error will also affect the renewal of 150,755 current policies. As part of the settlement, IAG estimates that it will make payments of up to $3.48 million to affected customers who have previously been paid out on total loss insurance claims, and those with total loss claims, to reflect what they should have received, or are due to receive. IAG will also offer the more than 150,755 current policyholders the option of either accepting an increased sum insured amount and therefore a higher insurance premium or agreeing a different value. Settlement 2012
GE Money Misleading advertising of the benefits of a debt consolidation loan Settlement 2011
Pulse Utilities New Zealand Limited Trader breached the Fair Trading Act by misleading customers about the amount they were required to pay when they sought to terminate their supply agreement with Pulse by failing to carry over a prompt payment discount to the customer's final invoice. Settlement 2011
Vodafone New Zealand Limited Misleading representations that its Vodafone Live! mobile phone internet browsing service was "free to browse" and customers would be warned before incurring any charges. What consumers could and could not use for free was unclear and customers were not warned before incurring expensive data charges. Judgment 2011
Telecom Corporation of NZ Ltd Alleged false or misleading representation as to the price of broadband services in that Telecom had overcharged customers due to a problem with the data usage meter. Settlement 2011
Compass Communications Limited Alleged misleading representations in that there is a lack of disclosure regarding the existence of a daily administration fee. Judgment 2011
eFeMCee Finance Limited (FMC) and Albert Loots Trader has admitted charging unreasonable fees and misleading customers. Judgment 2011
Wenatex New Zealand Limited Trader breached the Fair Trading Act by misleading customers about their cancellation rights under the Door to Door Sales Act. Judgment 2011
Tel.Pacific New Zealand Limited Misleading representations as to calling rates of prepaid phone cards. Judgment 2011
Vodafone New Zealand Limited Alleged misrepresentations concerning various broadband and mobile phone promotions. Judgment 2011
Morrison Car Company Limited Misleading representations that vehicles were available on Trade Me for $1 reserve when trader was bidding on his own auctions (shill bidding). Vehicles were also advertised and supplied without CIN notices. Judgment 2011
Contact Energy Limited Misleading consumers as to amount owed on accounts. Settlement 2011
Takarunga Management Limited and Trevor Allan Ludlow Charging a third party fee that exceeded the actual amount payable, charging a cancellation fee not for reasonable expenses related to the contract and its cancellation. False and misleading representations as to rights. Judgment 2011
Takarunga Management Limited and Trevor Allan Ludlow Charging a third party fee that exceeded the actual amount payable, charging a cancellation fee not for reasonable expenses related to the contract and its cancellation. False and misleading representations as to rights. Judgment 2011
Honey New Zealand (International) Limited Trader imported Chinese powered royal jelly and sold it in capsules claiming it was "made in New Zealand". Judgment 2011
The Home Finance Company Misleading advertising of sale by instalment scheme. Judgment 2011
Sung Yub Paik trading as Healthways Products Corporation Limited Trader was misrepresenting the amount of mg in a capsule of its royal jelly products and the country of origin of product. Judgment 2011
Vodafone New Zealand Limited Vodafone New Zealand Limited was fined $81,900 after being found guilty of breaching the Fair Trading Act in relation to its $1 a day mobile phone internet data charges Judgment 2011
Vodafone New Zealand Limited Vodafone New Zealand Limited was fined over $400,000 in the Auckland District Court today after pleading guilty to breaching the Fair Trading Act in relation to its Vodafone Live! mobile phone internet service Judgment 2011
Carter Holt Harvey Limited Civil action brought by Commission where it was alleged that CHH claimed that its Laserframe timber had the structural characteristics of MGP10 timber, meaning it complied with the requirements of AS/NZS Standard 1748:1997. The Commission alleged some of the timber did not comply with the Standard. As a result of the settlement of the case CHH will make a voluntary ex gratia payment of $1.5 million to a project relating to the restoration and rebuilding of Christchurch following the earthquakes. No admissions by CHH Settlement 2011
Spazio Casa Limited Spazio Casa made a number of false and misleading representations on its website and in brochures regarding the country of origin of a number of the products it supplied, that its products were unique and not sold by other retailers in New Zealand,and claims about price Settlement 2011
Balmoral Homes Limited Misleading representations that building contracts came with a Master Build Guarantee. Guilty pleas. Day and Jones both convicted and ordered to pay fines of $15,000 each. Total reparation ordered of $127,000 ($30,000 of which for emotional harm for 6 victims). Judgment 2010
Affinity Car Rental New Zealand Limited, Euro Car Rental New Zealand Limited, Kylee Harris, Gary Harris Alleged misleading representations that rental car hirers responsible for damage and that some cars were late model. Also charges levied which had not been disclosed in rental agreement. Fined a total of $37,960. $5,750 reparation to affected consumers. Judgment 2010
Prokiwi International Limited Alleged misleading representation as to the country of origin of soap. Fined $48,000. Judgment 2010
Shim's International Limited Alleged misleading claims on the labels of the products. Fined $6,000. Judgment 2010
Korea Health Limited and Sang Rae Kim Alleged misleading claims on the labels of the products. Korea Health Limited fined 16,000, Sang Rae Kim fined $12,000, plus costs. Judgment 2010
GM Car Wholesalers Limited Alleged that trader is providing false information in CINs Settlement 2010
Propertyfinance Securities Limited, New Zealand Guardian Trust Company Limited Alleged misleading representation as to the full prepayment formula applied in that the creditor stated in the disclosure it would use the safe harbour formula when in fact it applied a formula based on bank swap rates Settlement 2010
Avanti Finance Limited Alleged that creditor was charging debtors an unreasonable estimate of creditor’s loss upon full prepayment of their consumer credit contracts, and made misleading representations as to the characteristics of the formula used to calculate the estimate of loss. Creditor found not guilty in District Court in 2009. Commission appeal to High Court dismissed. Judgment 2010
Sunrise Motor Group Limited and Surya Kumar Trader advertised vehicle for sale on Trade Me and at car yard that was imported damaged and this information was not disclosed on CIN. Judgment 2010
Shell New Zealand Limited Alleged misleading representation re fuel economy formula Judgment – all charges dismissed 2010
Progressive Enterprises Limited Alleged that offer made of prize with no intention to supply Judgment – Court of Appeal dismissed charges 2010
TMG Asia Pacific Pty Limited Failure to disclose terms and conditions of text to win competition, misleading consumers. Fined $125,000, court costs $1040. Judgment 2010
Mainfeeds Limited formerly t/a PCL Industries Limited Trader produced calf feed that did not comply with nutritional specifications on packaging. Fined $125,000, court costs of $1040. Judgment 2010
Tristram European Limited Misleading representations about the price of motor vehicles particularly that vehicles could be purchased on 0% interest when 0% interest terms were not available on a lower negotiated price. Alleged misrepresentation about the price of vehicles, particularly that the amount of establishment fees had not been disclosed in advertising. Fined $18,000, court costs $650, solicitor costs $750. Judgment 2010
New Zealand Natural Care Products Limited Misrepresentation as to country of origin of product. Fined $15,000, court costs $260. Judgment 2010
Larry Roger Binns Misrepresentation of quality of timber. Fined $15,000, court costs $130. Judgment 2010
Foundation Custodians Limited Alleged that creditor is charging an unreasonable estimate of its loss upon full prepayment and is in fact charging a different formula to that disclosed Settlement 2010
Dolbak Finance Limited Alleged breach of s13 Fair Trading Act (continued enforcement of contracts where full disclosure has not been made) and ss17 and/or 32 of the CCCF Act. Litigation resolved. Guilty pleas to representative charges and sentencing. Convictions entered on 2 charges (one each act) and fined $1000 on each charge. Judgment 2010
Budget Loans Limited Misleading representations that creditor has the right to charge undisclosed credit fees, to charge default interest and fees after the sale of repossessed secured items, which is prohibited under the Credit (Repossession) Act, that it has the right to attach its security interest to after-acquired consumer goods without specific appropriation despite section 44 of the Personal Property Securities Act. Creditor fined $30,750. The creditor reversed or refunded around $500,000 in overcharged interest and fees. During the Commission's investigation Budget Loans also voluntarily reversed or refunded an additional $571,000 to its debtors in relation to credit fees that were not the subject of the current charges. Judgment 2010
ANZ National Bank Limited (ANZN) and ING (NZ) Limited (ING) Misleading representations about the degree of risk when when promoting and marketing the ING Diversified Yield Fund (DYF) and the ING Regular Income Fund (RIF). Questions and answers published on 21 July 2010 are available at Fair Trading/Enforcement Outcomes Settlement, $45 million in refunds to affected investors 2010
Telecom New Zealand Limited Misleading advertising statements in relation to its broadband at dial-up prices promotion, particularly the disclosure of the 12 month contract term and data allowance associated with the basic broadband plan. Settlement 2010
Methven Limited Misleading advertising statements over conventional shower water flow being 20L per minute, when majority of NZ showers have a water flow of between 6-10ml per minute. Judgment 2010
Kenneth James Ross Alleged that some aircraft and performers stated in advertising will not be apearing at the airshow. Criminal charges also laid by Police. Judgment 2010
Southern Cross Finance Limited Creditor is charging and unreasonable full prepayment fee. Settlement 2010
Telecom Corporation of NZ Limited and Xtra Limited Alleged misleading consumers by wrongly billing over 130,000 new broadband customers Settlement, $9.5 million in refunds paid to affected customers 2010
Southern Cross Finance Limited In a settlement with the Commerce Commission, Southern Cross Finance Limited has admitted charging unreasonable loan establishment fees and will refund just under $700,000 to 250 customers it overcharged between July 2006 and October 2009. Settlement 2010
A) Invercargill Property Management Limited (IPM), B) Newfoundland Limited, C) Southern Housing Limited, D) CMA Property Investments Limited Alleged breaches of section 14(1)(b) by IPM by making representation that were false or misleading as to the nature of the interest that the IPM scheme occupiers acquire in the properties. A) Fined $38,500 and $25,000 reparation B) Fined $13,500 and $10,955 reparation C) Fined $10,500 and $5,000 reparation D) Fined $40,000 and $42,290 reparation Judgment 2010
Telecom New Zealand Limited Misrepresentation concerning Go Large plan and the speed available for broadband users. Fines $500,000. Judgment 2010
A) Discount Premium Holidays Limited B) Devang Parikh A) False and misleading claims surrounding a holiday voucher scheme. Fined $209,000; court costs $4,940; solicitor fees $7,500. B) Attempting to mislead the Commerce Commission. Fined $7000; costs $260. Judgment 2010
Beneficial Finance Limited Alleged misleading representation as to the terms and conditions of a credit related insurance policy Settlement 2010
Cash Converters Alleged that the creditor is charging unreasonable credit fees, including a data management fee Settlement 2010
Medical Mortgages Limited Alleged that trader discloses that it uses the safe harbour formula, but actually charges the swap break cost. Settlement 2010
The Warehouse Limited Trader pleaded guilty to multiple breaches of the Fair Trading Act and has been fined a total of $209,600. The charges related to The Warehouse misleading consumers about the advertised price of goods, using bait advertising, making false claims that certain products were 'exclusive to The Warehouse' and false labelling on some of their duvets. Judgment 2009
Big Blue Limited Misleading customers by claiming its product was '100% Pure New Zealand Mineral Water' and making false scientific claims about the benefits of its supposedly 'energised mineral water', which was really just processed tap water Judgment 2009
Eden Office Seating Misleading representations concerning the place of origin of goods. Fine $5000, costs $2500, court costs $130. Judgment 2009
Farmers Trading Company Limited Misleading conduct that a television was new when in fact it had been returned for repair by a previous customer a year earlier. Fine $10,000, costs $130. Judgment 2009
Redpaths Furniture Limited Represented 'was’ price was not true and had not been charged for six months or more. Recent price established, before sale, was less than represented ‘was’ price. Fine $28,000 ($1,000 per charge), court costs $3640 ($130 per charge). Judgment 2009
Peter Linton t/a Charitables Op Shop Misleading consumers about the nature of a charity shop. Reparation $10,000. Judgment 2009
The Pawn Shop Alleged that creditor is charging unreasonable credit fees and not providing initial disclosure on payday loans Settlement 2009
TrustPower Limited Misleading its customers about the nature of a power bill review service. Fined $17,000. Judgment 2009
Brownlie Brothers Limited Misleading representations as to the country of origin of fruit juice. Fined $45,000, costs ordered $6780. Judgment 2009