Guiding consumers since 2009

Lewis breaches National Credit Act

By Jessica Anne Wood

The National Credit Regulator (NCR) announced that Lewis Stores was found to be in breach of the National Credit Act (NCA) by the National Consumer Tribunal. This follows months of claims that Lewis was incorrectly charging customers certain fees, as well as investigations into its lending practices. (See below for links to related articles)

The National Consumer Tribunal, in its judgement, agreed with the claims made by the NCR. Jacqueline Peters, manager of Investigations and Enforcement at the NCR noted that the basis of the NCR’s referral was that the sale of loss of employment cover to pensioners and self-employed consumers was unreasonable and imposed an unreasonable cost on such consumers. The same applied to the sale of occupational disability cover to pensioners where they no longer had an occupation.

The National Consumer Tribunal found Lewis Stores:

  • Had acted unreasonably by offering or demanding pensioners or unemployed consumers to take out loss of employment insurance.
  • Had acted unreasonably by offering or demanding pensioners to take out disability insurance.
  • Was guilty of prohibited conduct for breaching the National Credit Act 34, 2005.

In addition to these findings, the Tribunal interdicted Lewis Stores from engaging in this conduct in the future, and has ordered that an independent audit be conducted on all credit agreements that have been entered into by Lewis Stores since 2007.

Furthermore, Lewis Stores have been ordered to reimburse all affected consumers, as identified in the audit, the premiums paid for the insurance wrongfully sold to them.

“The NCR considers this a great victory and will be returning to the NCT to argue the imposition of a fine on Lewis Stores,” revealed Peters.

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