Lender cops $15k fine
Christchurch-based lender 4J Enterprise Ltd has been fined $15,000 for providing consumer credit without being registered on the financial service providers register.
Judge Elkin also sentenced the company’s director, Hope Suan, and senior manager Juvy Suan to 140 and 150 hours of community work respectively.
The lender offered loans of $500 to $15,000 with terms ranging from six months to two years. While 4J said it charged an annual interest rate of 33 per cent, its records showed some borrowers, who were mainly members of the city’s Filipino community, were charged up to 55.6 per cent.
4J pleaded guilty in June to a representative charge under section 11 of the Financial Service Providers (Registration and Dispute Resolution) Act. Mr and Mrs Suan pleaded guilty as parties to the company’s offending at Christchurch District Court.
Louise Unger, executive director of response and enforcement at the Financial Markets Authority (FMA), says lenders providing consumer credit must meet applicable registration and licensing requirements.
“These requirements are there to help ensure lenders meet minimum standards and can be held accountable for complying with consumer credit laws,” adds Unger, pictured below.
“If you need a licence and registration, have them in place before you lend. Despite 4J being told in May 2024 that it couldn’t lend without being registered, or being certified by the Commerce Commission, which was the requirement at the time, it carried on for another 18 months.”
During that period, it issued 46 new loans totalling $81,110 to 27 borrowers and collected about $65,000 in interest on 50 new and existing loans. It stopped collecting interest from November 2025.
The Commerce Commission investigated 4J and initially filed the charges. Under the Credit Contracts and Consumer Finance Amendment, the FMA assumed responsibility for the prosecution from July 1 when consumer credit regulation was transferred to it.
Consumer credit providers must be registered on the financial service providers register for the service they provide and, when required, hold a consumer credit provider licence from the FMA.
From July 1 this year, an entity acting as a creditor under a consumer credit contract generally needs a consumer credit provider licence. Lenders were previously required to be certified by the Commerce Commission.
Before borrowing, consumers should check the lender is registered for the service and is licensed by the FMA. More information is available online at before you borrow money.
Information for lenders, including licensing and compliance guidance, is available on the FMA’s credit providers’ pages.
The maximum penalty for a breach of section 11 of the Financial Service Providers (Registration and Dispute Resolution) Act is 12 months’ imprisonment, a fine of up to $100,000 or both for an individual, and a fine of up to $300,000 for a company.
