It seems to me that a lot of people are being hounded to pay debts they don’t owe, for all sorts of reasons.
In some cases, they have been handed over to debt collection agencies despite having settled their accounts, others have been the victim of identity fraud, and had huge debts run up in their name, and some have fallen victim to a fraudster working at a company they’ve contracted with.
In many cases, through an alleged “system error” – more likely a human error – their ID number, cellphone number or bank account number has become attached to someone else’s debt.
These innocent parties have to go to extraordinary lengths to get the companies concerned to accept they’ve got it wrong, and stop the hounding, often unsuccessfully. The injustice is appalling.
A huge percentage of the debt on the books of debt collectors has prescribed.
Consumers who don’t understand how the Prescription Act works end up paying old debts – plus a crippling amount of interest and costs – unnecessarily.
The Prescription Act is intended to give consumers protection against debt collectors hounding to pay an old debt that we can barely recall.
In short, according to the Prescription Act, if, in the past three years you have not made any payment towards settling a debt, acknowledged owing the debt in any way – including over the phone – agreed to pay it, or been summonsed in respect of it, it has prescribed, and you can raise this as a defence when asked to pay it.
The collector should close its file on you at that point.
Some collectors trick people into forfeiting their right to claim prescription as a defence by casually asking them, “So if you won the Lotto, would you settle this debt?” By answering yes, they have effectively acknowledged the debt and are liable to pay it.
It is legal for a debt collector or attorney to demand payment from a debtor for a prescribed debt, and if you succumb to the pressure and pay it, you can’t raise the defence of prescription afterwards.
As many have discovered, mortgage (home loan) debt, taxes and any state-related debt, such as TV licence fees, prescribe only after 30 years.
I deal with a constant stream of complaints from people who feel they’re being unjustifiably hounded for TV licence debt they don’t believe they owe.
In many cases, the root of the problem is that although they notified the SABC of the fact that they no longer have a TV – or that they no longer need a licence in their own name – they didn’t do so in the prescribed way, with all the required documentary proof. (Call the SABC at 011 330 9555 for details.)
And then the payment demands start coming.
Stephen Borain began his battle with SABC’s debt collecting agents, VVM, in February.
Despite not having owned a TV set for some years, he said, he’d begrudgingly paid licence fees on receipt of a notice to pay.
He received his first SMS from VVM, saying he owed R300, in March, having been unaware until then that he was considered to have been in arrears.
Requests to VVM and the SABC for an explanation were ignored, he says.
Then he received an SMS thanking him for his arrangement to pay VVM, followed by a R300 debit on his bank account. He denied making any such arrangement.
That was in March. And so began months of e-mailing, as the R300 debits continued. Finally, in July, VVM froze the account, and Borain thought the saga was over.
Then last month, it took a bizarre turn, which is when I got involved.
Having asked his bank, Absa, to investigate the basis on which the R300 deduction was made from his bank account, VVM wrote to the bank stating that last November, in a phone call with a VVM agent, Borain agreed to pay R300 a month via debit order, and supplied his bank details for this purpose.
Oddly, the creditor was listed not as the SABC, but two other companies – MTN and Sanco Development Trust.
Sums of R300 were duly deducted in November, December and January.
“Please note that our agent would not have captured all these correct banking details without the authority of the account holder,” VVM told Absa.
Borain denied ever having had such a conversation, saying the deductions were made illegally, and that he knew nothing about owing any money to MTN or the trust.
“The deductions off my account which I was querying with VVM related to an SABC matter that has been subsequently closed,” Borain told his bank.
“How this has now evolved into a completely different and bogus matter is beyond my understanding.”
I took up the matter with VVM’s complaints manager, Johandrie Wahl.
She said VVM had investigated and concluded that “Mr Borain’s banking detail was erroneously captured on the incorrect account. I have spoken to Mr Borain and apologised for the error.”
He has since been refunded.
But that doesn’t explain what happened. Borain denies having the conversation in which he is alleged to have given his banking details.
And how odd that the SABC debit order amounts and the other “erroneous” ones were all R300.
The mind boggles.
I’m glad my query led to the realisation that Borain’s account was being raided in error, but am left wondering why the bank’s questioning of the rogue debits just a week earlier didn’t elicit the same answer.
Supersizing helps manufacturers stay competitive rather than fizzle away
In the past few years I’ve written extensively about “pack shrinkage”, involving everything from soap and chocolate slabs to tomato sauce and pet food which has been repackaged in slighter smaller packs in the hope that consumers won’t notice.
I’ve often made the point that if manufacturers weren’t being sneaky about it – if they wanted consumers to know the products were now “more affordable”, as they put it – they’d announce “now in smaller pack” on their new packaging.
But they don’t do that.
Beacon has borne out my point with its new Fizz Pop packaging.
The sucker hasn’t shrunk – it’s grown from 13g to 20.5g.
Interestingly, the sucker shrank in 2004 from 15g to 13g, and the subtle downsizing may well have continued – as has happened with many chocolate bars – but for the fact that Fizz Pop has acquired a host of competitors which have all gone big, making the Fizz Pop’s appeal fizzle.
Yogueta first shook up the market with its “big head” sucker, and Fizz Pop’s other competitors, including Monsta Pop, Big Pop and Pin Pop, followed suit, all being between 20g and 30g. Not only that, they came up with exciting combinations of flavours, making Fizz Pop look puny and boring in comparison.
So in January last year, Beacon – part of the Tiger Brands stable – introduced the bigger Fizz Pop, sugar division marketing manager Sian Loehrer told Consumer Watch.
The price went up by 30 percent, but without any “consumer messaging” on the wrapper about the bigger size, consumers didn’t embrace the new suckers.
“They would not have known that the size had increased unless they bought the product, and they weren’t buying the product as the price increase was perceived to be prohibitive,” Loehrer said.
That’s when the company decided to go big with its “bigger” message on the label.
It was a costly exercise, reprinting the entire range of flavours, and a new pack design is now on the cards.
All in the name of getting more longer-lasting balls of sugar into people’s mouths.
Of course, there was no “smaller pop” announcement when the Fizz Pop shrank in 2004. Funny, that!
Making a strong case for refunding bottles
Reader Craig Matthew posed an interesting question to Consumer Watch recently.
Are bottle stores obliged to refund consumers on the 90c deposit paid on quart beer bottles when they are returned?
“I buy quart beers from my local bottle store, Tops at Spar in Glenore Centre, Glenashley, on a regular basis,” he said. “When I don’t take back my empties, I pay a deposit on my next purchase, so I get a build-up of bottles.
“I recently bought a case of 12 quarts from that bottle store, arriving there with 18 bottles, and requesting a refund on the other six (R5.40). But I was told that it is their policy not to pay deposit amounts on bottles returned without making a replacement beer purchase.
“When I said that I would leave them there, the manager, Simon, told one of his staff to put them in the rubbish bin outside the store.
“Where does one stand in a case like this? Apart from the monetary consideration, surely it’s in everyone’s interest to recycle glass?”
For the sake of R5.40, that bottle store lost a loyal customer, as Matthew has vowed not to return.
I asked Robyn Chalmers, head of media and communications at SAB, whether shops it supplied were compelled to pay deposits on returned quart bottles.
“We do recommend and encourage outlets to accept returnable bottles and to provide the customer with the full deposit value,” she said.
“We believe it’s bad practice for an outlet to refuse empty bottles and not return the deposit, but the ultimate decision on whether to do so rests with the outlet.
“There is no legislation or regulation which obligates them to do so.”
I took up the matter with Tops Glenore manager Mandy Conradt, who confirmed their policy, but said her colleague ought to have used his discretion and refunded Matthew, a regular customer, for the return of the extra six bottles.
She also undertook to introduce a new policy of accepting back all quart bottles, and refunding the 90c deposit.
“After all, we will be reimbursed by SAB for them,” she said.
Oh, and Matthew will be getting a case of beer as a goodwill gesture. Cheers to that!
LG agent was ready, willing and able
I recently reported on a reader’s incredible after-sales service from Amazon.com in the US when two of her Kindles developed faults.
Well, Valerie Lancaster of Durban shared her experience of great service delivery closer to home.
When one of the drawers in the freezer section of her out-of-warranty LG fridge-freezer broke, she did an internet search for “LG Durban”. This turned up agents IRS Tronics, and she sent them an e-mail, asking if she could buy a replacement drawer from them.
“The next day I got a reply from them asking for the model number, which I forwarded to them.
“The day after that, I received a mail from IRS’s Donovan Moodley with a diagram of the freezer with all the parts numbered.
“I phoned Donovan, who took down the part number and explained that they would get the part from Johannesburg as soon as I deposited the cost of the part – R149.
“I did so that day, and four days later Donovan phoned to tell me that he’d received the part. The next day it was delivered to me at no extra charge.
“I still can’t believe it all took less than a week from my first enquiry to receiving the drawer.”