• M2M money train

    SA's biggest mobile operators have found a new revenue stream, says Gugu Lourie.

  • Customers as experts

    Some M4Jam micro jobbers are now helping others to refine their ability to make money.

  • Sticking it to Sanral

    The time is now for citizen-centric leadership to stop the road to ruin, says Mandi Smallhorne.

Data provided by iNet BFA
Loading...
See More

Debt counsellor stole from clients

May 25 2011 20:24 Sapa

Related Articles

Do you need a debt counsellor?

Credit regulator deregisters counsellor

Consumer appetite for credit increases

Consumers still mired in debt

Blow to banks as indebted get a break

Regulator keeps right to accredit agents

 
Johannesburg - The National Consumer Tribunal (NCT) on Wednesday ruled in favour of the National Credit Regulator (NCR) against debt counsellor, Zimkitha Hazel Zilo, who misappropriated about R170 000 of consumer funds.

Zilo was a registered debt counsellor who created a fictitious credit provider linked to a bank account under her brother's name, the NCR said.

She then added this fictitious credit provider as a credit provider to which the Payment Distribution Agent (PDA) had to distribute funds. As a direct result of her actions, the PDA paid an amount close to R170 000 into this account. In terms of her registration conditions, Zilo had to make use of an approved PDA to distribute funds to creditors.

"The NCR was informed of the irregularity by the PDA and conducted a thorough and speedy investigation into the matter," said NCR's investigations and enforcement manager, advocate Jan Augustyn.

The NCR then launched an application for the cancellation of Zilo's registration as a debt counsellor. Zilo's registration as a debt counsellor was cancelled with immediate effect.

The debt counsellor was ordered to refund all consumer funds misappropriated with interest to all affected consumers. The tribunal ruled that by creating a fictitious account and defrauding consumers of funds intended for distribution to their credit providers, Zilo had contravened the National Credit Act and her conditions of registration.

"The NCR regards this as a very serious abuse because consumers under debt review can lose their homes and most valuable assets if payments are not made as per the agreement with their credit providers," Augustyn said.

Other registrations cancelled

The Tribunal also ordered Zilo to repay the money plus 15.5% interest per annum to the PDA within 20 days and to send proof to the NCR within 45 days of the order being granted.

Failing this, she may be liable to face a fine or imprisonment for a period not exceeding 10 years or she may be liable to both a fine and imprisonment.

Augustyn said the ruling demonstrated that the NCR would protect consumers under the debt review process from unscrupulous debt counsellors.

He said the NCR had also referred the matter to the police for further criminal investigation.

The ruling comes after several other debt counsellors' registrations were cancelled, and these included those of Zolile Senior Njokweni, Petrus Martinus Ferreira's trading as Ferreira Debt Counsellors (FDC), Sash Sahibdeen, Barry Kotze and Christopher Bornman, who has since appealed the action in court.

The cancellations were a result of the debt counsellors found to have repeatedly contravened the National Credit Act (NCA) and their conditions of registration.
debt counselling
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
5 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

Small Business

Expanding your business requires capital and banks have stringent lending criteria in place.
 

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...