GE Money fined $1.5m: guilty of false or misleading representations

ASIC cracks down on consumer credit provider GE Money for making false or misleading representations to over 700,000 customers.
 
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01.GE Money misled 700,000 customers

GE Money pays fine credit cards stacked

Consumer credit provider GE Money has been ordered to pay a penalty of $1.5m for making false or misleading representations to more than 700,000 of its credit card customers.

The federal court has found the company, also known as GE Capital Finance Australia, told certain credit card customers between 5 January and 27 May 2012 that to activate their credit card or apply for an increased credit limit they also had to consent to receiving invitations to apply for credit limit increases.

The representations were made just before government legislation that banned unsolicited invitations for credit limits came into force. The court found that GE Capital didn’t actually need consumers to opt in to receiving increased credit limit offers.

In the judgment, Justice Jacobson said:  "The contraventions were serious and the reach of GE Capital’s conduct was extensive and substantial [and it] was a systematic and deliberate attempt to mislead cardholders into giving their consent to receive invitations for future credit increases so as to avoid losses of up to $6 million, which were projected to be suffered by GE Capital as a result of the tightening regulatory environment."

ASIC deputy chair Peter Kell said: "This ruling serves as a reminder that there are important safeguards to help consumers manage their debt levels. If businesses seek to side-step these, ASIC will not hesitate to use its powers to protect consumers."

GE Capital must now advise cardholders what the decision means for them and publish a notice on its website. During the case, the company admitted they broke the law.

 
 

 

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