Furniture retailer, Lewis Stores, is once again facing the wrath of the National Credit Regulator (NCR) over alleged financial abuse of customers many of which are poor people.
The retailer seems to have been selling a redundant maintenance plan on purchases of goods that came with a guarantee from manufacturers. This is like purchasing a maintenance plan from the car retailer alongside the car manufacturer’s maintenance plan.
Following its investigation and findings, the NCR has forwarded the matter to the National Consumer Tribunal. The NCR is also charging Lewis for Club Fees that are said to be in contravention of the National Credit Act (NCA).
Lewis stands accused of being a serial transgressor of fair trading practices as captured in the National Credit Act.
Lewis is disputing these allegations and yesterday released a statement detailing the maintenance agreement charge and dismissing the allegations.
The statement said the referral to the tribunal relates to:
The costs charged by Lewis Stores under certain maintenance agreements concluded with its customers since 2007, in terms of which they have allegedly been provided with extended warranty cover, in addition to the cover available to them in terms of supplier and manufacturer warranties for the same period; and
· Certain club membership fees charged by Lewis Stores to its customers since 2007.
statement added that “The NCR alleges that the maintenance costs and club fees were charged to customers in contravention of the NCA and requests the Tribunal to order Lewis Stores to repay the maintenance costs and club fees to customers.
“The NCR further requests that the Tribunal restrains Lewis Stores from charging maintenance costs and club fees to customers in an unlawful manner in the future and seeks certain ancillary relief, including the imposition of an administrative fine of 10% of the annual turnover of Lewis Stores.”
Lewis said “Having considered the allegations contained in the referral along with Lewis’ external legal counsel, Lewis believes that the allegations are without merit. Accordingly, Lewis has instructed its legal representatives to oppose the referral on its behalf.”