ComCom wins loan appeal
The Commerce Commission has won its appeal against the Auckland District Court decision to dismiss 19 charges against finance companies Budget Loans Limited and Evolution Finance Limited. The two companies, both run by convicted fraudster Allan Hawkins, were initially found guilty of 106 charges in July 2016 under the Fair Trading Act after the Commerce Commission alleged they misled consumers about their rights. The 19 charges which were dismissed and then appealed against concern representation over the companies’ right to charge interest and costs on contracts into before June 6 2015, after the two companies had repossessed and sold borrowers’ property. The companies bought old loan books from failed finance companies – including National Finance, Western Bay Finance and Equality Finance – with most originating between 2001 and 2006. The Commerce Commission argued that lenders were prohibited under the Credit (Repossession) Act from charging interests and costs after the first security item had been repossessed and sold. Budget Loans and Evolution Finance claimed that when a loan was secured over multiple items, all items had to be repossessed and sold before they needed to stop charging interest. The District Court agreed with the Commerce Commission and ruled that once an item had been repossessed, a lender cannot charge interest or costs, including the cost of further repossessions. The 19 charges will be reconsidered by the Auckland District Court. Budget Loans and Evolution Finance are legally still trading. While Evolution Finance has ceased to advertise its services, the Budget Loans website is still active, which advertises personal and vehicle loans that will be approved within one hour. Allan Hawkins is the sole director of both convicted finance companies, according to the Ministry of Business, Innovation and Employment records. Evolution Finance’s ultimate holding company is Cynotech Holdings, which was liquidated in 2013. Budget Loans’ holding company, Cynotech Securities, is still in operation, with Allan Hawkins as the sole director.
