Bankrupt loan shark fined for consumer credit law breaches
A bankrupt loan shark charged interest on loans of as much as 1738%.
BUSINESSDESK: A bankrupt loan shark who charged interest on loans of as much as 1738% has been fined in the Christchurch District Court for breaches of consumer credit law.
Barry Hunt was fined $18,532 plus court costs of $1461.79 after being prosecuted by the Commerce Commission over 15 loan contracts with 11 different debtors between September 2006 and August 2007.
Among breaches to the Credit Contracts and Consumer Finance Act, the contracts failed to give the full name and address of the lender and Hunt used a range of business names, none of which were legal entities, the commission said in a statement.
He was an undischarged bankrupt at the time.
The contracts also failed to specify annual interest rates, instead giving rates “significantly lower than was actually applicable” or giving a weekly or fortnightly rate.
“The actual interest rates charges ranged from 29.5% to 1738%,” the commission said.
“Third-tier lenders are dealing with the most vulnerable consumers” who may have been turned down for credit by first- and second-tier lenders and may be in a position where they accept “otherwise unacceptable terms and conditions”, the commission said.
“It is reprehensible that such lenders will take advantage of these consumers in the way Mr Hunt did," competition manager Stuart Wallace said.
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Bankrupt loan shark fined for consumer credit law breaches
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