The Satinsky Group, which runs the R699-a-month car ownership scheme in South Africa, is investigating some of its clients for fraud, saying that they have used a Facebook group to facilitate dishonest gain.
According to Satinsky, it has emerged via the Facebook group, ‘I have been done in by Drive a New Car from R699 per month’, that some of its clients have been illegally claiming the advertising fees they are paid for carrying branding (for the company and other third-party advertisers) on the rear windows of their cars.
One couple posted on the Facebook group that they took three-years worth of photo’s in advance, then changed the date stamp on each photo, removed the stickers and continued claiming their advertising fee. In other words, they were getting paid for advertising long after they had removed the stickers.
It has emerged that they are not the only individuals who have tampered with date stamps and continued to claim their advertising fees illegally.
Fees are paid based on the number of kilometres driven in any given month. Clients have to upload date-stamped photographs of their vehicles and odometers, to show evidence of branding and distance traveled.
On April 30, Moneyweb reported that some vehicle owners were complaining of being underpaid and had threatened to resort to legal action.
The Satinsky Group of Companies says it engages with approximately two million clients on a monthly basis. “If we note the number of complaints on Hello Peter in comparison with our client interaction the ratio of complaints to transactions as a group is relatively miniscule,” Satinsky told Moneyweb.
Of the 85 Hello Peter records posted since May 23 2013, eight are compliments and the rest complaints against the company. The complaints are largely related to non-payment, short payment, contract cancellation and poor service.
‘We’re not letting go’
Satinsky said that of the 203 members in the Facebook group (as at May 8), only 85 are clients of the company.
“We are currently busy with an internal audit at the Blue Lakes help desk,” Satinsky told Moneyweb, noting that it had uncovered major fraud being committed by some of the vehicle owners.
Satinsky is the acting agent for Blue Lakes SA, the domestic arm of Hong Kong-based Blue Lakes Trading and Promotions Limited.
Vehicle owners enter into a contract with Blue Lakes after purchasing their vehicle and are paid an advertising fee from third parties, including RE/MAX.
Satinsky said it had every intention of bringing criminal charges against those individuals who were guilty of committing fraud and had to now audit every single photo submitted under its car ownership scheme. In February, it had 17 000 vehicles on its books, but this figure is likely to have grown.
Sadly, this means that those individuals who are experiencing legitimate difficulties with payments may have to wait longer to have their complaints resolved.
After Moneyweb reported that the company’s director of corporate services, Barnard Jooste, had resigned from the group, Satinsky clarified that he had in fact been redeployed into another division within the group.
The group denied the alleged legal action being taken by some of its clients against chairman, Albert Venter.
As with any other car purchase, Satinsky’s clients enter into financing agreements with banks, to which they pay the full purchase installment each month and are then paid a separate advertising fee by Blue Lakes.
A number of owners have complained that they can no longer afford their vehicles, due to being underpaid by Blue Lakes, and may soon be forced to sell their vehicles.
However, banks do not take into account any advertising income when assessing a client’s disposable income and determining whether they can afford a vehicle.
Absa and Standard Bank both confirmed that finance was granted to clients in line with the banks’ normal credit criteria. Absa said it was not party to nor promoted the advertising service agreements between Satinsky clients and Blue Lakes and was unaware of which clients concluded such agreements.
Standard Bank said that it did not take into account financial arrangements that customers made regarding “their newly acquired assets” when granting credit. It urged customers who may have difficulty meeting their financial obligations to discuss it with the bank immediately in order to reach a solution.