Saturday, 14 January 2017

The Voice - Consumer's Voice

Must we pay?

Hi. Just wanted to ask about this higher purchase set up. A few years ago I got a decent job or so I thought. As I was earning a bit I went and got a fridge and washing machine on higher purchase. Then at work we started having issues and we were not being paid on time sometimes even two months and we were renting so we landed up leaving and now we could not keep on living with the unsure salaries. On leaving I left the fridge and washing machine in my aunts care. I believed I would get back to work sooner than I did. Now naturally the store were calling for payment and after telling them my story I asked what my options were. Do I return everything or wait to start working again?

Eventually I told them to get the things from my aunts house. I believed that was the end. I had given them their stuff back and they would resell to get their cash balance back. Years later again I felt a bit comfortable with life so I felt I should try again to buy some furniture and I find I owe P7,500 and I was blacklisted at ITC so I cannot do anything that requires me to pay off like furniture and loans. All because these guys led me to believe something that was not true. My boyfriend experienced the same thing so all in all we owe about P18,000 we owe yet we have nothing to show for it.

So does this mean this is it I cannot do anything, take a loan, get something on credit or the like for the rest of my life?

What a horrible start to 2017. I despise hire purchase. It’s a truly terrible way to buy things. Firstly, it’s enormously expensive, you pay at least twice the cash price for an item. Secondly, when things go wrong you’re completely screwed. The problem with hire purchase is that you don’t own the goods you think you’ve bought until you’ve made the last payment. Until that moment the goods still belong to the store. You’ve just been hiring them. That’s why it’s called “hire purchase”.

It also means that if you fall behind with your instalments the store can come to your house and remove their property. They’ll then auction them for a fraction of their original cash value and deduct that amount from the balance you still owe them. That leaves you with no fridge or washing machine and still owing them almost the same amount of money as before the repossession. And get this. There’s absolutely nothing you can do about it. That’s because you signed an agreement accepting this. I don’t mean to be insensitive but did you even read the agreement you signed? If you had, you probably would have run screaming from the store.

Unfortunately, the only thing you can really do is ask for a full statement of the debt and see if you can negotiate a repayment plan that you can afford and the store can accept. If they’ve handed the debt over to debt collectors I suggest you meet with them as soon as possible. You might be surprised how flexible they’ll be.

What can I do about this juice?

I bought some juice at one of the wholesalers in Gaborone and my toddler started having a running stomach, thats when I realized that the juice I feed her which I bought was expired, when I took it back the manager who was very rude. It says best before 15.12.2016 time 11:02, I bought it on the 20.12.16.

Could you assist with which step to take.

There’s a lot of confusion about the dates that are shown on the goods we buy. The most important date you’ll see is the “Expiry date”, sometimes shown as the “Use By” date. Any store that sells something after these dates is going to be in big trouble with the authorities because that’s illegal, contrary to the Labelling of Prepackaged Foods Regulations. No store wants to do that.

However, what you saw was something different. The juice you bought showed a “Best Before” date. These dates are less strictly controlled because they’re just advisory, informing the customer when the goods will be in their best condition. There’s no suggestion that goods consumed after this date are necessarily harmful or dangerous. Although it’s certainly bad practice, it’s not actually illegal for a store to sell an item after the Best Before date.

I think you also need to be practical. Is there any actual evidence that the juice you bought caused your child’s stomach upset? We’ve all had upset stomachs and it’s often very difficult to identify what it was we ate or drank that actually caused it. I hope you took the juice back to the store and showed it to the management? Even though it’s not illegal it’s certainly not something a responsible store would allow.

It’s all about your health

I’m not usually one for New Years Resolutions, mainly because the resolutions most of us make, to drink less, eat better, take more exercise, be nicer to our spouses and drive more carefully usually last a matter of days before we revert to our old ways. The health resolutions are also often the quickest to disappear. Before we know it we’re back on the chocolate and fried food because, well, it tastes so good and we’re all rather weak-willed.

In 2017 Consumer Watchdog has resolved to focus on something specific. Something ambitious. Something that underpins what every one of us cares about more than anything else in life.

This year, everything we do is going to be about your health.

And this isn’t just for your sake, it’s also for the companies that sell you things. Despite what you might think, it’s in the best interests of the companies who sell you things for you to be healthy. Supermarkets, network providers, banks and insurance companies all benefit when you’re healthy, almost as much as you do. That’s because healthy customers spend more and go back to them over and over again. Customers who are unwell or dead make them less money so it’s in their interests to keep you healthy. Life and healthcare insurance providers are a great example of this. The longer you pay your premiums the more money they make from you and the longer it is before they have to pay for your operation, spectacles or funeral. But are you unhappy about this? You have a longer period of comfort, knowing that in the event of a disaster you and your family will be looked after and you’re not dead. Are you going to complain about that?

Everyone benefits when you and your loved-ones are in top condition. Your health benefits everyone.

We’ll also be talking about the threats to your physical health from the cast range of charlatans, crooks and scammers who do their best to promise us miraculous solutions to our health problems. It won’t be the first time we’ll be covering these issues but this year we’re going to be a lot louder. We’ll be talking about the people who approached me in a shopping centre car park just a few days ago handing out leaflets entitled “An end to ill-health”. I didn’t stick around long enough to see if they were selling religion or health quackery, it doesn’t matter. Such claims are illegal and immoral. They’re also incredibly dangerous. If only one person believes their lies and stops talking their medication for high blood pressure, cancer or immune problems then the peddlers of lies will have blood on their hands.

The same goes for the Multi-Level Marketing schemes selling vastly overpriced products and whose representatives make dangerous claims about their benefits. There are still people claiming that so-called alternative or complimentary products can cure cancer, diabetes, hypertension and can “boost” your immune system. We all know what they mean by that last one, don’t we?

We’ll continue to take them on this year as well.

But it’s not just your physical health we’ll be talking about. It will be your mental health as well.

Your mental health and your physical health are in fact the same thing. A healthy mind, as they say, leads to a healthy body and you can’t be completely mentally healthy if you’re worried about your physical health. You can’t also be mentally healthy if you’re worried by debt, unemployment and inflation. We’ll be talking a whole lot more about healthy ways to manage your money and how to spend wisely. We’ll also continue to go on and on about the scams, deceptions and lies you’ll hear from the endless line of crooks desperate to steal your money. We’ll be delving more in the foreign exchange trading scams, fake Bitcoin “investment” schemes and the ever-evolving variety of pyramid and Ponzi schemes.

We’ll also be talking about what you should be doing with your money to protect, preserve and grow it. Not just the things you should avoid, but the things you should be looking at to save and invest your money.

And let’s not forget your cyber health. With so many of us connected to the internet, socialising and spending our money online, protecting our cyber health is now as important as protecting our purses and wallets. Many of us now know about the “romantic” scams where victims have sent away lots of money to the scammers pretending to be their loving boyfriend who claimed to have sent them a package containing money, jewellery and technology that’s now held up by customs authorities somewhere. We know that this is just the attest incarnation of the “advance fee” scam and we know that there is no package, no customs agent and not even a boyfriend. We know it’s all a scam. But if we all know this why do we still hear about women falling for it? Because we haven’t made enough noise about it yet.

Despite our efforts to educate people these scams still occur and people are still falling for them. The fight needs to continue.

Of course, we can’t do this alone. While we know a thing or two about critical thinking, scams and customer service we’re not doctors, leading-edge techies, investment advisors or lawyers. That’s why we’ll be reaching out to the people who are. Expect to see input from some of the country’s leading experts in their various fields over the coming year.

Maybe you’re prepared to be part of this effort? Are you willing to offer your energy to protect not only yourself but also your family, friends, co-workers and neighbours? Will you resolve to be healthier in 2017?

Then come and join us as we all become a lot healthier, wealthier and happier.

Tuesday, 10 January 2017

Our response to the threat from World News Media

A few days ago we received an email from World News Media Ltd that said:
To whom it may concern,

Please take down the following page on your website:

This is a defamation of our companies reputation & character.

If you have any queries about the authenticity of our awards feel free to contact me directly & I will answer any queries you may have.

Please remove the post within 28 days or we will have no choice but to instigate legal proceedings.

[Name withheld] | Legal Assistant | World News Media Ltd
[Please note that any poor English is theirs, not mine.]

Having received a number of legal threats over the years, I was a little disappointed by this one. Firstly, it’s usual practice when composing a legal threat to establish your bona fides before making the threat. An introduction along the lines of “I am from company XXX and we own / represent / have been instructed by company YYY” is the norm.

The post they complain about, from July 2012, related to a news story in Mmegi entitled "Stanbic, Barclays, FNBB win banking awards".

The Mmegi article reported:
According to World Finance, banks were judged on a variety of indicators including new and innovative services, smart partnerships, key financial ratios, pre-tax profits, real growth and steps taken to prepare for stricter banking regulations."World Finance's Banking Awards celebrate those who have capitalised rather than caved at times of high stakes," says a World Finance statement.
My response was simple and you can see it here. I asked:
But how exactly are these "awards" awarded? Who selects the winners? Who checks that the companies are actually legitimate? Who makes sure they're not actually crooks?
All the original post from 2012 did was to report that certain banks in Botswana had received awards from World Finance and that the Mirror in the UK had reported that World Finance had given awards to two companies, World Commodity Partners Ltd and Tullett Brown Ltd, that had later been shown to be deeply suspicious.

[You can see a copy of the latest Mirror article about them here and an archived copy of the original article here.]

The Mirror told me yesterday that they’d asked World Finance to comment on the obvious mistake of giving awards to crooks but that they hadn’t taken the opportunity to respond.

That’s as far as my comments went about World Finance. I didn’t say their awards were bogus, fake or not respectable and I didn’t say anything bad about the company. I just said that they’d given awards to at least two suspicious companies in the past and that:
Before being impressed by a company winning an award you need to be very skeptical about the award. Ask some questions like "How exactly did they win it?"
Given the history of bogus awards that we covered over the years (that many companies still proudly declare they've won) I think that’s a reasonable question, don't you?

Another important thing that these threats should include is some explanation of what they think was defamatory. But on this occasion they don’t even give a hint. Not a single clue. They just said that “This is a defamation” and that if I don’t accede to their demands, they’ll “instigate legal proceedings”. Do they even know themselves what offended them? Have they even read the original post?

And it’s not defamation.

Section 195 of the Penal Code of Botswana says that a comment is not defamatory if “the matter is true and it was for the public benefit that it should be published”. There’s no evidence, not even a shred, that anything I wrote was untrue and it’s clearly for the public benefit if people are encouraged to be skeptical, don’t you think?

Here’s another thing. Why did it take them four and a half years to take offence? It’s clearly not high on their list of priorities. Here in Botswana, claims for defamation are “prescribed” after one year, which strikes me as very reasonable.

So, in summary, they’ve taken an awfully long time to be offended by something that isn’t offensive, that is actually true and that has been said by other organisations much more prestigious and widely read than us. They have no reason to object to anything that was posted. And they’re wasting my time.

So will I be removing or changing the post?


Saturday, 7 January 2017

A rather sad legal threat

In comes a rather sad legal threat about something we posted here four and a half years ago.

The post, from July 2012, related to a news story in Mmegi entitled "Stanbic, Barclays, FNBB win banking awards".

The article said:
According to World Finance, banks were judged on a variety of indicators including new and innovative services, smart partnerships, key financial ratios, pre-tax profits, real growth and steps taken to prepare for stricter banking regulations."World Finance's Banking Awards celebrate those who have capitalised rather than caved at times of high stakes," says a World Finance statement.
Our response was simple and you can see it here. I asked:
But how exactly are these "awards" awarded? Who selects the winners? Who checks that the companies are actually legitimate? Who makes sure they're not actually crooks?
Given the history of fake awards that so many companies proudly declare they've won, I think those are reasonable questions, don't you?

At the time I posted the comments, I also found a number of comments about the company that had given the banks these awards, World Finance. I mentioned that the Mirror in the UK had published accusations that World Finance had given awards to companies that turned out to be run by crooks. That story is no longer available on the Mirror site but you can see an archived copy of it here.

I concluded with this simple comment:
Before being impressed by a company winning an award you need to be very skeptical about the award. Ask some questions like "How exactly did they win it?"
Yesterday we received the following email headed "Cease & Desist notice":
To whom it may concern,

Please take down the following page on your website:

This is a defamation of our companies reputation & character.

If you have any queries about the authenticity of our awards feel free to contact me directly & I will answer any queries you may have.

Please remove the post within 28 days or we will have no choice but to instigate legal proceedings.

[Name removed] | Legal Assistant | World News Media Ltd
[Note: Any inaccuracies or grammatical errors are theirs, not mine.]

Note that they don't give any indication of how the comments might have caused their company any damage. They also don't repudiate or even deny any of the comments I made, they just resort to the usual response of "This is defamation" and they'll sue.

I will be going back to them and asking for some clues about how they feel they've been wronged.

Watch this space!

Sunday, 25 December 2016

World Ventures will still lose you money

World Ventures is a pyramid scheme that we've mentioned many times before.

Recently it updated its brand and started calling itself "Dream Trips" but it's still the same old thing.

World Ventures publish an "Income Disclosure Statement" every year and it makes interesting reading. Like all pyramid schemes the majority of the money is earned by a very small proportion of the people, the ones at the top of the pyramid.

The statement for the USA in 2015 can be seen here and you're welcome to analyse it for yourself. However, if you don't have a calculator to hand, here are some of the highlights.
  • Referring to their Independent Sales Representatives (“IRs”), they report that "22.24% of all IRs earned a commission or override, while 77.76% did not". In simpler terms, three quarters of all their American recruits made nothing from the scheme. Nothing at all.
  • Two thirds (actually 68.7%) of all the income is earned by the 3.7% at the top of the pyramid.
  • 84% is earned by the top 19%. To put it another way, 81% of the recruits who earn money have to share just 16% of the money.
  • If you're at the top of the pyramid you're doing well. The 1 in 14,000 people at "International Marketing Director" level earns an average of $409,280. The 1 in 20,000 described as "National Marketing Director" level have an annual income of $238,645.
  • However, of the small proportion who made some money, the average income was $1,348.82 but that's not a good indication of what the average recruit will earn because the figures are distorted by the tiny proportion at the top who earn a fortune. The median income level is a much better illustration of what you can expect to earn. That's a meagre $150 per year.
But don't forget two important things. Firstly, like I mentioned above, only a quarter of all the recruits earn anything. These figures just refer to the quarter of victims who earned anything at all. 

More importantly, these amounts refer to income, not profits. These figures are before the recruits took account of all the money they had to spend on travel, accommodation, electricity, internet access and the coffee and drink they had to buy when they did their best to recruit other victims into this scam. I suspect that most people earn less than they spend trying to make the money. They lose money.

In short, please don't waste your time, effort and money with World Ventures or Dream Trips.

Friday, 23 December 2016

Next year's mistakes

I’m not psychic, I can’t see into the future but I am certain that 2017 will have more than its fair share of scams. I’m certain of it because that’s the pattern. Scams aren’t going away. In fact they’re multiplying.

Despite the lessons we should have learned over the last few years, people continue to fall for the nonsense peddled by the proponents of various Get Rich Quick schemes. You might think that with the memory of Eurextrade fresh in our minds, people would now understand that any scheme they encounter that promises to quickly make them rich is a lie, wouldn’t you? But it’s not so.

Even within days of Eurextrade collapsing the same people who had been busy recruiting other victims had moved to an identical but short-lived scheme calling itself Oil of Asia and were doing their best to recruit other to that scheme instead. Not only hadn’t they learned their lesson but they thought they could recover some of the money they’d lost by joining another scam. These were serial scam victims.

And it’s still happening. In 2016 we’ve have a series of pyramid and Ponzi schemes. As with all scams, most of them failed to gain any momentum and quickly faded away. We were lucky enough to have seen some of them in time and warn people but a few gained some traction and managed to sucker in some victims.

The year began with MMM Global, a classic Ponzi scheme formed by a convicted Russian scammer called Sergei Mavrodi. In fact, Mavrodi spent time in a Russian prison for running Ponzi schemes so you’d think that would make people think twice before handing over their cash to a man like him. Not so. Thousands of South Africans, Zimbabweans, a few of us and many, many Nigerians signed up and handed over their money hoping to earn the 100% return the scheme promised every month. However, like all such schemes it collapsed firstly in South Africa and is now, as you read this, collapsing in Nigeria, leaving many people much poorer than when they joined. Our good luck was that our market was too small for MMM Global to thrive and unlike Eurextrade, this scam wasn’t targeted specifically at Botswana.

Image of Mavrodi being escorted to prison in Russia c/o Mail & Guardian
Then came called Amazing5 that offered 5% per day for a month, a deal that, if it was true, would have more than quadrupled your money. That one didn’t last very long at all.

Then came Pipcoin, the first example we saw of a new type of scam. These are the pretend Bitcoin scams. Bitcoin is a genuine digital currency that has the potential to change the future of money but these scams are just pale imitations of Bitcoin. In the case of Pipcoin there was no actual currency, digital or not, it was nothing more than a Ponzi scheme. They claimed that a mere 35% profit per month but that wasn’t enough to persuade enough victims to hand over their money.

Pipcoin was very closely followed by its twin, Billcoin. This scam made a much more ambitious promise of 80% profit each month but this was also no more than a Ponzi scheme in which any “profits” people received were just taken from the initial contributions made by people joining after them. Billcoin still exists and there’s even a Facebook group devoted to promoting it in Botswana but I suspect it’s already about to fail very soon.

Helping Hands International came next. This was a pyramid scheme in which recruits were encouraged to recruit multiple levels of people beneath them and it was made very clear that there was “no buying of stock” and “no selling”, just the recruitment of other people. That’s the dictionary definition of a pyramid scheme.

But Helping Hands International was different. Their lies were extraordinary. For instance they claimed that their scheme was “supported” by companies such as Hyundai, Apple, HP and Lenovo but this was just a pack of lies. Companies like those don’t “support” pyramid schemes.

Then we went back to the pretend Bitcoin scams. It’s important to say again that there’s nothing inherently wrong or illegitimate about Bitcoin. It’s a real currency but it’s a really risky thing right now. It’s a real currency but it’s entirely unregulated and there are no rules to protect you if you buy and spend using Bitcoins. There’s absolutely nobody to complain to if things go wrong. Also, like any other currency, it’s value can go down as well as up and Bitcoin has crashed before.

But this time it wasn’t Bitcoin we met, it was a scheme surrounding the buying and selling of Bitcoins calling itself the Bitclub Network. Some clues about the real nature of this scheme can be found on their web site. They describe their scheme as “The most innovative and lucrative way to earn Bitcoin” and they say they have “a referral program so you can get paid for anyone you refer”. It’s a pyramid scheme, nothing more than that.

My prediction is that there will be more and more schemes like this in 2017, particularly the ones surrounding Bitcoin. They’ll exploit our ignorance and they’ll continue to target us as a country. That’s because we have a reputation for being gullible. Eurextrade showed that. That was a scam specifically targeted at us. It didn’t try to recruit people in Namibia or South Africa, it was only recruits in Botswana they wanted and our reputation hasn’t changed over the subsequent years.

My hope is that in 2017 there’ll be a miraculous surge in skepticism in Botswana and that scammers will learn that we’re no longer the gullible nation of potential victims they currently perceive.

But I suspect I’ll be disappointed.

The Voice - Consumer's Voice

Is my bank being fair?

My dad had a fixed deposit account and had an agreement of a stop order of P2,000 to the account monthly. His money was to be withdrawn at the end of the year. This was to be December 2015 but when the time came he didn’t find his monies. He had been to and fro with the bank to no avail. He was then told that a teller defrauded his account and is on suspension and they are still investigating and they will refund him shortly. To date he is being sent from pillar to post. The manager keeps giving empty promises of tomorrow never comes.

My question is who is at fault? The bank staff right? So should my dad suffer because of incompetence of a manager to conclude the matter? Why don’t they refund the customer and they will do their investigations on their own? Will they pay him interest? My father cannot really stand up for himself so he knows less of his rights. Can you assist him?

What a dreadful Christmas present for your Dad! For two years his bank has disappointed him and effectively stolen his money. Yes, I DO mean stolen. Even if the management didn’t steal the money, their member of staff did and they should stand up for their customer, the person who has done nothing wrong in this situation.

I can understand why the bank would want to conduct a thorough investigation of the situation and even to check whether your Dad was perhaps conspiring with the teller to defraud the bank. But that’s clearly not the case. It’s been a year and the police would have been round at his house by now if they had any suspicions. Lawyers will tell you that “justice delayed is justice denied” and clearly your father has been denied justice. And he’s been denied his money.

It really is unacceptable to take this long to deprive your Dad of his money. Rest assured that we’ve already contacted the MD of the bank and I suspect he’ll be getting his money very shortly.

Update: I received a message from the bank saying that they spoke to the father and his story isn't quite the same as the one the son told us. Also he hasn't responded to their invitation to discuss the issue. Maybe there's slightly more to this story than there seems?

What should I do to protect myself next year?

What lessons would you give us that can protect us against abuse in 2017?
  • Be a skeptic. Don’t believe anything anyone says to you until you have a good reason to do so. There are plenty of persuasive people out there who are doing their very best to steal your money from you. If anyone ever approaches you with a miraculous way to make money then ask yourself a simple question. How do they gain from recruiting me?
  • Never join any scheme that requires you to recruit layers of people beneath you. If you’re lucky it’ll just be a Multi-Level Marketing Scheme like Amway or Herbalife from which you will certainly make no money at all. If you’re unlucky it’ll be a pyramid scheme like World Ventures or Helping Hands International that will leave you frustrated, irritated and poorer.
  • Never join any scheme that is based on “donations”. It’ll almost certainly be a Ponzi scheme like MMM Global, Billcoin or the late and unlamented Eurextrade. Again you’ll end up embarrassed, angry and poor as a result.
  • A spending tip. Remember that what seems like the cheapest option is usually not actually the cheapest. The phone that has the cheapest purchase price probably comes with only a one or three month warranty so when it goes wrong after six months you’ll need to by another brand new phone to replace it. Spending a few hundred extra on a phone with a full warranty would have saved you lots of money.,
  • Save rather than spend. I know it’s boring but your Mum was right. It’s always better to save up for something and buy it for cash than to buy it on hire purchase. ALWAYS. You’ll thank me when you’ve done it.
Finally, enjoy Christmas and the New Year. Drive safely, eat and drink sensibly and love your friends and family like you were never going to see them again!