The Voice - Consumer's Voice

Can’t they remove my name?

I and my husband we got a fridge on credit and we failed to pay on time and they suddenly took it from us. So we applied for a loan and the bank told us that our names are on ITC cos of the fridge. We settled and got the fridge back home. Now it's been a month and 3 weeks and the ITC have not yet cleared our names.

It's devastating cos we paid with the money from cash loans so there is a lot of interest there and we are left with nothing. The store said they did their part so the ITC people in S.A. are the one who a dealing with that, deleting our name in the system. Last week they said we should wait for 7 days and they will delete but it's been more than 7 days. We want to take a loan from the bank to do my building project and they a just waiting for us. Someone told me you will definitely help me.

I don’t think you’re going to be pleased with what I have to say.

The issue of the store registering you with a credit reference bureau should fix itself once TransUnion (formerly ITC) update their files. This can take a little while and normally gets done within 30 days of the store telling them that a debt has been settled. The problem is that stores aren’t always as quick to do this as they should be.

However, there’s a more important issue here. I think you urgently need to think carefully about your financial situation. You had problems paying your hire purchase agreement and then got into even more trouble by borrowing from microlenders to pay off that debt. And now you want to borrow money from a bank to pay off that debt? I accept that borrowing from a bank is FAR better from borrowing from a microlender and also far better that borrowing on hire purchase but I think you’re in a downward spiral of debt. I suggest that you speak to a debt counsellor who can advise you on the steps you should take to stabilize your finances. One thing that I suspect they will say is that a “building project” is not nearly as important as paying off debt.

One final point. You really won’t like this one. I couldn’t help notice from your Facebook profile that you are actively recruiting people into a scheme called Global Dream Network? How is being part of an illegal pyramid scheme going to help your finances? It’s only going to make your situation much, much worse, particularly when you consider that the penalty for promoting or even just joining a pyramid scheme is now a fine of up to P100,000 and up to five years in prison.

How can I make her pay?

Hello. I am asking for an advice. 2 years back I entered into a verbal agreement with a friend of mine. I entered in an agreement with a furniture store on her behalf with the agreement that she will pay off. Last month the store called to tell me the account is in arrears and I am being blacklisted. Is there any action I can take against this friend, because now she is avoiding me. Please help.

I’m no attorney but you don’t need to be one to realise that you’re in a mess. The only written agreement in this situation is the hire purchase agreement YOU signed with the furniture store and that commits YOU to make the payments, regardless of who actually possesses the item that the store provided. The fact that your friend has the goods doesn’t matter to the store. You are the only person they care about. Ok, I mean your money.

There’s something else you should remember about buying things on hire purchase. Neither you nor your friend own them, they still belong to the store until the final instalment has been paid. Until that moment, the store is entitled to repossess them if you fall behind with the payments you committed to making. They’re also entitled to register you and your debt with credit reference bureaux.

Obviously, what you should have done is signed a written agreement with your friend that described the arrangement you made with her. That way you might have been able to force her to help you pay off the debt that YOU have towards the furniture store. However, given that she has already failed to pay your debt to the store, do you think she either has the money or cares very much?

The Voice - Consumer's Voice

Can I take the tyres back?

How can you help me. I came to a tyre place to buy BF Goodrich tyres and the sales guy convinced me to buy Cooper tyres as he said they are better tyres only for one tyre to be damaged by a thorn and now they don’t want to take their set of tyres back and give me BF Goodrich. They are saying they can only take them back for P1000 each but I bought then for P2500 each. Even their employees are confirming that Cooper is junk. What can you do to help?

Firstly, I don’t believe there’s anything wrong with Cooper tires, at least not in my experience. I’ve had at least one complete set and I believe they’re still in use on the vehicle I bought them for.

Secondly, I’m not sure you have a right to demand that the tyre dealer replace the set you bought. Is there any real evidence that it was a problem with the tyre that caused it to be damaged? Surely it was the thorn you say that damaged the tyre and that could just as easily have happened if you’d chosen any manufacturer?

Section 13 (1) (a) of the Consumer Protection Regulations is clear that consumers are entitled to goods that are “of merchantable quality” and from what you say, these tyres were that. Remember also that Section 13 (1) (c) of the Regulations is clear that when goods are second-hand, they can’t be sold as new. If the dealer was to take back the tyres they sold you they’re going to lose out financially, which is why they’re asking P1,000 per tyre.

Given the circumstances, I suggest it’s best to stick with the tyres you bought.

Where’s their money?

Several people contacted us recently with very similar questions. They cancelled what they called an insurance policy and didn’t get their money back. Have they been robbed?

There are two issues here, depending on what type of policy they actually bought. The first relates to insurance policies. With an insurance policy, you pay a premium, usually monthly, and in return the insurance company takes on the risk associated with the event you’re insuring against happening. Whether it’s a policy covering your vehicle, your house, your health or your life, the insurance company will pay the costs (or most of them) if something bad happens. The commonest type of policy most of us have is a funeral plan. If, during the term of the policy, one of the people named in the policy dies, the policy will pay the costs of their funeral. However, if you cancel a funeral plan, you don’t get your money back. That’s because you were paying for a service that you received during the period of the policy, even if you didn’t claim. Yes, even if you didn’t claim, you still got “cover” against the risk.

Then there are investment products. They’re a way of saving money for the future and usually they’re for the long-term investor and that makes them a bit more complicated. Many long-term investment plans involve payment of commission to the company that offers the product or the agent that sold it to you. However, in a policy that can last for ten or twenty years the agent doesn’t want to wait all that time for their income so they “front load” their earnings at the beginning of the policy period. In other words you pay the commission up front in the first couple of years. You only start to earn money after that period is concluded.

The problem happens if you cancel the policy during that early period. Because the commission is taken in that period, you might not have actually earned any money yet. You might take home very little or perhaps nothing at all.

We’ve heard about this second situations many times and it seems that sometimes the people selling these policies either neglect to mention the front-loading of the commission or they deliberately hide it. Even if they do mention it they often do so using language that customers don’t understand and the result is simple. People don’t realise that if they cancel their policy in the first few years they get little or nothing from it.

Clearly it’s time for the people selling these policies to be a lot more open about how these policies work and in particular about things like front-loading.

Meanwhile, the lesson for us all is to read and thoroughly understand any insurance or investment policy we buy, before we sign them, not afterwards.

The Voice - Consumer's Voice

Do I have any rights?

About 2 months back I bought a second hand car from a car dealer in Mogoditshane. The guy said the car was a sold as is. I requested to test drive and had a mechanic look at it and it all looked good. After paying for the car I was made to sign a document that its a buy as it is and that I can't hold the company accountable for any mechanical defects that I may notice afterwards. The dealer had assured me the car was in good condition and that I only need to service and it will be ok.

A day or two after the transaction I realised the car was unstable when it reaches speeds above 80km/h. I went back to the dealer and he advised I fix the suspension of the car and it will be well. So I went and did just that unfortunately even after that the car still shakes and swerves when doing above 80km/h speed. There was no way of noticing this when test driving because speed limits in the city and surrounding areas is 60km/h.

Is there anyway u can help?

I’m sorry but I don’t think I can give you any good news.

The car dealer did everything he could to protect himself and I suspect there’s little you do to make him change his position. He allowed you to take it for a test drive and you noticed no problems during that drive. I understand that the speed limits would have restricted you to relatively slow speeds but it might have been wise to ask to take it somewhere you could test it at higher speeds. I was lucky a few years ago when a dealer selling me a car insisted that we go for a drive on a highway and also off-road to prove how well the car drove. That’s a lesson we should all perhaps learn. A 2-minute drive at 60 km/h isn’t enough.

The dealer also allowed you to do something we always advise consumers to do, to get an independent mechanic to inspect the vehicle. It’s a shame that your mechanic wasn’t able to spot the problems the vehicle obviously had.

Finally, and this is probably the really bad news. you signed a document saying that the vehicle was sold “as is” and also that you wouldn’t hold the company accountable for any faults that emerged later. The only document relating to the sale appears to be one that says you’re waiving your rights.

I’m sorry I don’t have better news.

Can I get a different one?

In 2017 in June I bought a JVC home theater system to be paid in installments for 24 months. After I got the products within a month it had a problem of reducing its volume every time when in use. I reported it to the stores around August 2017, then I returned it back which then they take about 7 months without giving me a new one but all the time I was paying.

In 2018 around March they gave me another JVC home theater which later then gave me the same problems and then in January 2019 I returned the products. Remember this is the second one. When returning the second one I wrote a cover letter which I explained that I don't want the products anymore rather they should give me the different item but same price. In April 2019 they called me to come and get another JVC home theater system. Then I refuse but the management told me that since I'm not working and my sister is the one who pays my instalments I'm unable to take a new item of same price from the shop since they will need a pay slip which I don't have to open a new account for another item. So they told me that the only option I have since I'm not working is to get another JVC home theater system again which I'm afraid it will repeat the same problem. So I please need help to change this item to another item with same price. The reason why I refuse the same item is that it's guarantee it's 3 years.

This is complicated. Let’s begin with your rights. When you are given a product that is “not of merchantable quality” as required by Section 13 (1) (a) of the Consumer Protection Regulations you have a right to one of the ‘three Rs’, a refund, repair or replacement. However, and this is important, it’s the store that decides which you receive. This store is with its rights to replace the item with an identical one. I know it’s frustrating that they keep going wrong but look on the bright side, they offer a three-year guarantee so you’ll continue to get support until next year.

The Voice - Consumer's Voice

Is this a genuine job offer?

I received an email from Al Zawali Construction in the United Arab Emirates saying that my “qualifications and experiences which you submitted online matched the requirements for our on going employment”. I don’t remember submitting my details online so do you think this is genuine?

It’s a genuine scam, that’s for sure.

Here’s a simple truth. Employers don’t contact total strangers offering them jobs. The email you sent me contained a few clues that it wasn’t genuine. Firstly, the email didn’t include your name, it just said “Greetings”. if it was true that they saw your details online, don’t you think they would know your name? Then they ask you to send your CV. Surely, if this was genuine, they’d have seen it already?

Then there’s the language they use. “qualifications and experiences”? “for our on going employment”? Does that sound like a well-educated HR professional to you? It doesn’t to me.

There are other clues that you need some cyber-detective skills to notice. Their web site says that “Over thirty thousand(30,000) employees have worked at the company for over 10 years and nearly half of the 1000+ employees have worked at Al Zawali Contruction Company for more than five years” but their
domain, alzawaliconstruction.com, was only registered on 2nd March 2019. And they can’t spell the name of their own company correctly!

There’s one final clue that you wouldn’t know about. Consumer Watchdog received exactly the same email a few days ago. We certainly didn’t post our profile online because Consumer Watchdog isn’t a person.

This is the beginning of an advance fee scam. Sooner or later they’ll demand money from you in order to obtain the fake job they say they’re offering. They’ll probably say it’s for a visa or legal fee and that’s what this scam is all about, that advance fee. Even if you pay them it won’t stop, they’ll keep demanding money until you either realize it’s a scam or you simply run out of cash. Please don’t waste your time and money.

Is Donations for Wealth real?

You’re not the first to ask us this. You won’t be the last.

Donations For Wealth describe themselves on their web site as "a 21st Century Donation system and Crowd Sharing Platform” and that “Now Here's A Sure Way To Get The JUMP On a Money Train & Start Making More Money Than You Ever Thought Possible!”

They claim that their business “brings forth a new way of raising funds for various causes, whether it is for personal needs or a host of worthy causes, such as Paying off Debts, Groceries, Holiday, Weadding, Buying a car, churches, schools, non-profit organizations, etc."

“Weadding”?

This is the language used by Ponzi schemes. You “donate” money into the scheme and somehow, perhaps magically, greater amounts of money come back to you. For instance they claim that you can “Turn R10 into R100,000“ without explaining how this might be possible. They then claim that recruits can “Turn R100 into R40,000” which is surprising as it’s less than the first offer for a bigger “donation”. Perhaps most impressively they suggest that you can “Turn R5 into 2 Million”.

Like other Ponzi schemes they don’t even attempt to explain how the money they claim you can make is generated. That’s because like with other such scams the only source of new money is from the people who join after you. That’s where they get the small amounts of money they might offer you in return for your “donations”. That’s how a Ponzi scheme works.

Like all Ponzi schemes Donations For Wealth will collapse. Their domain was only registered in February this year so they’ve had a couple of months to steal people’s money. I predict they’ll be gone with victim’s money in another few months. Please don’t be one of those victims!

Also, remember that Section 9 of the Consumer Protection Act outlaws Ponzi schemes as well as pyramid schemes. Do you want to run the risk of a fine of P100,000 or five years in prison even for just joining a scam like this one?

The Voice - Consumer's Voice

Is Global Dream Network legit?

I’ve been invited to seminars about Global Dream Network. Do you think it’s legit?

Many people have asked us the same question recently. They’ve either been invited to seminars (mostly at UB) or encouraged on Facebook to join WhatsApp groups about Global Dreams Network. They seem to be recruiting very hard within the University of Botswana and also BIUST in Palapye.

GDN say that their business is "all about giving donation to another member and you shall receive donation in multiples" and that it’s “a Person to Person, Direct Funding and Crowd Sharing Platform”. That’s exactly what we heard from a range of previous pyramid and Ponzi schemes, a mysterious scheme in which you donate money and magically, a lot more money comes your way. It’s not difficult to see that it’s an impossible, unsustainable business model.

Their own marketing material is very clear, that after joining for a fee of R350, and then recruiting a pyramid four levels deep, they claim you’ll have “potential earnings” of R38,800. However, just a few moments of mental arithmetic show that this is simply impossible.

I joined one of their WhatsApp conversations and asked the recruiter “To make money do I need to sell any products or just recruit other people” and was told “You recruit 2 people and teach ur two people to do the same”. She then confirmed to me that there are no actual products being bought or sold. That’s the definition of a pyramid scheme. No products, just recruitment of other people.

I did a little detective work and even though it operates in Rands, Global Dream Network does not appear to be a registered company in South Africa. Their domain was only registered on 21st January 2019 but their registration details have been withheld.

The bad news for anyone promoting or even joining a scheme like GDN is that the 2018 Consumer Protection Act will punish them with a fine of up to P100,000 and up to five years in prison. I suggest you ignore any invitations from Global Dream Network and don’t waste your time, effort and money. You might also escape a huge fine and time in jail!

P.S. I’ve also written to UB, suggesting they think more carefully about letting pyramid schemes like GDN exploit their facilities.

Must I pay them?

I bought a fridge and TV in May last year and I paid and paid on so from September and October I didn't manage to pay and November they came and took their property. They gave me a week for me to pay the instalment I didn’t manage for some other reasons then month end I went there to pay and collect my things to find that they sold them ok I just left it there. Now I want to get a loan from my bank and found that my name is in ITC. I went to their office and they told me to pay the P15000 first so they can remove me from ITC for what I don't know because they already sold the property. They are saying that to remove my name I should pay the amount otherwise they can't help me. Help sir what can I do?

Unfortunately, there’s very little you can do. Here’s the first thing you should know about hire purchase. The reason it’s called “hire” purchase is that you are hiring the goods before purchasing them. Until you pay the final instalment, the goods still belong to the store, not you. That means the store is entitled to repossess them without notice or a court order.

It gets worse. When you buy something on hire purchase and you stop paying your instalments the store is entitled to repossess the goods and then sell them and the money they get from that sale goes towards the amount you still owe the store. The problem is that the profit they get from the sale is tiny compared to the balance you still owe them. If you then fail to pay off the amount you still owe, the store is entitled to register your debt with a credit reference bureau like TransUnion. That will then make it very difficult for you to get a loan elsewhere.

And the reason they can do this? Because it’s true. You do still owe the store that money and it’s reasonable for other organisations to know that before they lend you money or offer you credit. The best thing you can do is ot contact the store and negotiate a repayment plan that you can afford.

Consumer Alert - Donations For Wealth

Consumer Alert

Donations for Wealth

Donations For Wealth describe themselves as:

"a 21st Century Donation system and Crowd Sharing Platform. It brings forth a new way of raising funds for various causes, whether it is for personal needs or a host of worthy causes, such as Paying off Debts, Groceries, Holiday, Weadding, Buying a car, churches, schools, non-profit organizations, etc."

They also say that they are the "No 1 World's best donation system" make some remarkable offers:

Turn R5 into 2 Million / Turn $ 0.40 into $150,000
Turn R10 into R100,000 / Turn $1 into $6920
Turn R100 into R40,000 / Turn $7 into $2700
Turn 500 into R135,000 / Turn $34 into $9160
Turn R500 into R20,000 / Turn $34 into $1358
Turn R50 into R5000 / Turn $3.40 into $340
Turn R200 into R4600  / Turn $14 into $312
Turn R500 into R21000  / Turn $34 into $1400

And then they claim that you can "Turn A once-off R10 to over R100,000".

Given that there are no products, that the only source of income seems to come from subsequent recruits, it's clear that Donations for Wealth is a Ponzi scheme. Or maybe a pyramid scheme. One of their Facebook posts was very simple about the business model:

"Lets work hard and Make money! Recruit Recruit Recruit!!"

The FAQ page on their web site (the domain for which was only registered on 12th February this year) includes the question "Can I sign people up myself?" and answers:

"Yes you can. In fact, you are encouraged to do that to make sure that the people you refer are placed under the correct Referrer, which is you."

One of their Facebook posts was very simple about the business model:

"Lets work hard and Make money! Recruit Recruit Recruit!!"

Whether it's a Ponzi scheme or a pyramid scheme doesn't really matter. Either way it's illegal.

Will Amway make you rich? No.

Amway's income disclosure statement for the United Kingdom for 2017 (which covers the period the period from September 2016 to August 2017) makes depressing reading for anyone considering joining Amway. It'll be even more depressing for those who've already joined.

During that period there were 36,874 "Retail Consultants" and "Certified Retail Consultants". However, only 33% of them actually earned any money.

The average monthly income for these "Retail Consultants" and "Certified Retail Consultants" was a mere £77, just over P1,000. Remember that this is income, not profit. It doesn't include the cost of getting that income, the airtime and data, transport, power and water bills. I suspect that to earn P1,000 you probably need spend roughly the same amount.

The 66 people who reached the level of "Business Consultant", those at the top of the Amway pyramid, made an average of just over £27,000, around P370,000. Again, that's income, not profit. That's fewer than one in 500 Amway business owners. For reference, average earnings in the UK were also about the same amount.

The simple and depressing truth is that you need to be one of a tiny minority of Amway business owners if you want to make any significant money. How likely is that?