Avoid shocks, read fine print

15 February 2016 - 08:47 By Wendy Knowler

If there was one habit I would convince consumers to cultivate, it would be "ignore the large print, and seek out the small print, wherever it may be hiding". But sadly, we humans tend to focus on the big words and the colourful pictures which promise to make us better, somehow; thinner, richer, or at least less in debt.When we're desperate, we're less likely to bother to read through the boring small, grey print, and that's a shame because not doing so could be a very costly oversight.A number of online companies, with names designed to appeal to those in need of a loan - Loan Zone SA, Loan Scout, Loan Locator, Loan Connector - are not credit providers at all.They provide "convenient" services over the phone - including legal advice, motor vehicle accident claim advice, and a personal injury assistance advice - for a fee, of course, and as a free bonus they'll "attempt" to secure their subscribers a loan.Now it stands to reason that someone who is short of money is very unlikely to knowingly, willingly subscribe to a phone advice service for a problem which they may or may not have at some point - an annual subscription fee of around R400, which, incidentally, continues indefinitely until cancelled in writing.And, the fact that the company names all have the word "loan" in them, as opposed to "phone advice service" is more than a little misleading, in my view.But the true nature of the offering - and the financial implications - are all there in the small print, and by ticking the box, the user confirms that they have read the terms and conditions, consumers are legally bound to the subscription, and if they don't pay, legal action follows.Most of those who complain - I've had many complaints, as has HelloPeter.com - insist that they didn't realise they were committing to anything.As Sinegugu Biyela told In Your Corner when recounting her experience with Loan Zone SA: "I think I needed the cash so badly that I didn't question why the company would ask for my ID number and bank details on the 'online application' form."That is, until her bank account was debited in the amount of R399.If she has that amount reversed, she'll get a letter of demand.Last year, attorneys Worcester-based law firm Esterhuyze Inc, confirmed that it sent letters of demand on behalf of Loan Scout, Loan Connector, and Loan Tracer, among others, all registered companies owned by Lifestyle Direct of Century City.Such demands are now handled "in house", by Lifestyle Legal.I recently contacted the Lifestyle Direct Group about the case of Lucky Oupa, who was sent a letter of demand last November by Lifestyle Legal in respect of a debt of R1632 owing to Loan Scout, the bulk of which was presumably made up of a cancellation penalty, although there is no breakdown provided.I also asked about the company's modus operandi and the other "loan" companies operated by Lifestyle.Meagen Beelders of Lifestyle Legal refused to discuss the particulars of Oupa's experience, in the absence of his "written consent" authorising her to discuss such with me. The fact that he'd discussed the case with me was immaterial, she said.Responding to my questions around the transparency of the deal on offer, its true nature only being disclosed in the click-through terms and conditions, Beelders said "the consumer is expected to study its content and to make responsible and informed decisions as any reasonable consumer would"."The web pages alert the consumer to the services offered, and in no way misrepresent [what being offered to] the consumer," she said."Before submitting the application, the consumer is asked to tick a box to provide consent. Further below that is the wording: 'By ticking this box and submitting this application, you confirm that you have read the terms of service, terms of use, legal disclaimer and the privacy policy of Loan Scout SA and fully understand the contents . If you do not agree to the policies, do not submit this application'."From our point of view, if the consumer failed and/or was negligent in taking the time to ascertain what he or she is purchasing, or why he or she is completing an online form, providing personal information and agreeing to terms; that is the fault of the consumer, not the service provider."Loan Scout SA takes great offence to anyone who suggests their services are a scam."When I pointed out that she hadn't answered my question about whether the other loan companies, all with identical modus operandi, were also part of Lifestyle Direct, Beelders said it was clear that I was "busy with a fishing expedition" and that that information was "not for the public domain or in the legitimate public interest. From our side, this is the end of the matter."So much for transparency.WHAT TO DONever, ever ignore the terms and conditions of a contract or on a website. Seek them out like your life depends on it.Never supply your bank details online, other than to pay for goods or services on the secure site of a well-known, reputable company.CONTACT WENDY:Email: consumer@knowler.co.zaTwitter: @wendyknowler..

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