Nelson Building Society

The Commission has filed civil proceedings in the High Court against the Nelson Building Society seeking declaratory orders and pecuniary penalties in relation to breaches of the Lender Responsibility Principles and a failure to provide borrowers with the required continuing disclosure in breach of section 18 of the Credit Contracts and Consumer Finance Act 2003.

The proceedings relate to issues that occurred between 6 June 2015 and September 2024.

Nelson Building Society has consented to the Commission seeking the orders following a settlement between the parties prior to the proceedings being filed.

NBS self-reported and admitted that it failed to have adequate systems and processes in place to comply with Lender Responsibility Principles. In particular, by overcharging customers due to a misconfigured interest calculator;  by failure to provide continuing disclosure to borrowers; by failure to provide the required information and documents when loans were altered; and by failure to conduct proper affordability assessments, so that loans were approved without reasonable enquiries into borrowers’ ability to repay without hardship.

Some of the breaches resulted in borrowers and guarantors not receiving all the information NBS should have provided, in breach of the Lender Responsibility Principles.