R60bn Constitutional Court case launched against banks

Posted 16 August 2017

More than 225 applicants, mostly from Gauteng townships, have launched a suit in the Constitutional Court, claiming damages from the big banks for home repossession abuse. The applicants are claiming R60bn from the banks for unlawful repossession of homes since the Constitution came into effect in 1994. 

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The debt collection scam

Posted 26 July 2017

It’s an all too familiar situation for thousands of South Africans on a daily basis: your phone rings and you nervously look at the number on the screen, instantly your stomach turns with a knot as you recognise the number and once more you are faced with the dreaded choice of answering or blocking the call. You know if you answer you are undoubtedly going have to face a barrage of aggressive interrogation and questions from the person on the other end. If you don’t answer you know it will only be a matter of time before the cycle repeats itself.

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Welkom man owes Absa R1,4m after borrowing R52,000 in 2008

Posted 16 July 2017

It doesn't get more ridiculous than this. A Welkom man owes Absa Bank R1,4m after borrowing just R52,000 in 2008. Even Absa seems a bit embarrased by this travesty of justice, saying it is willing to accept a variation of the court order (which is certainly in violation of the National Credit Act and minimally one of the most negligent judgments to come to our attention).

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Public Protector defends plan to tackle Absa and Reserve Bank

Posted 07 July 2017

The public protector is standing by her controversial report on the Absa-Bankorp lifeboat, in which she recommends that the South African Reserve Bank’s constitutional mandate be changed, saying that she would oppose applications by the Bank and the Treasury to have the report set aside.

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Banks creaming it off bounced debit orders

Posted 22 June 2017

Banks are raking in between R500 million and R800 million a month from bounced debit orders. That’s a sizeable portion of the banks’ non-interest fee income each year for little more than running a piece of computer code. How is it that they have failed to heed the findings of a Compeition Commission investigation into banking charges which recommended a R5 cap on a bounced debit order? 

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Nedbank's attempt to repossess property foiled in Concourt

Posted 13 June 2017

A couple from Meyersdale, Joburg, nearly lost their home as the bank that held the mortgage bond agreement, insisted they pay back the entire outstanding bond for being two weeks late on their payment. The Constitutional Court slapped Nedbank down, arguing that the couple had lawfully reinstated their bond, even though they were late in catching up on arrears.

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How Nedbank sold a family's home for R10

Posted 29 May 2017

Here's a case where Nedbank repossessed a Katlehong home for R10. You read that right. Ernest Mashaba and his family have been put through a decade of hell and have been evicted four times, each time re-occupying the house, believing the bank had made a mistake. Here's the kicker: Ernest Mashaba never missed a payment and has written confirmation from the bank that his mortgage loan is fully paid up. His story is little different from that of Johm Mojaki of Randfontein, who also has written confirmation from the bank that his loan is paid up. His house has also been sold behind his back. "The only way they will get me out of here is in a coffin," he says.

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The world's best economist explains how banks have captured the wealth of the world

Posted 09 April 2017

Michael Hudson is a former bank economist whose job it was to work out the balance of payments surplus of South American countries so the major banks could capture this surplus for themselves. In his new book J for Junk Economics, reviewed by Paul Craig Roberts, Hudson explains how banks have become the new "rentier class" that has displaced the feudal lords of old. They produce nothing, but capture rents in the form of interest that have no costs associated with them. 

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How to defend your home against bank foreclosure

Posted 05 February 2017

Of all your assets, your home is the most important. More than 100,000 homes have been repossessed by banks since the Constitution came into effect more than 20 years ago. Most of these were repossessed because the home owners lacked sufficient knowledge of the law. The good news is that it is getting easier to prevent the banks getting away with this. The object of this article is to try and save your house and explore your legal defence options when the bank attempts to foreclose on your bond. 

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Goldman Sachs appointees fill the Trump administration

Posted 31 January 2017

Has US President Donald Trump, like his predecessors, been captured by Goldman Sachs? One would think so, looking at who he has just appointed to his administration. If that's the case, former Goldman Sachs alumni Nomi Prins says we can look forward to another administration doling out favours to the banks. Already, Trump has made six appointments comprising former Goldman Sachs employees. How did this onetime boutique bank end up on top of the world? Nomi Prins explains.

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Regulator takes Standard Bank to court to stop practice of "set-off"

Posted 18 January 2017

The National Credit Regulator (NCR) is seeking a high court order to stop banks from unilaterally taking money from customers’ savings accounts to settle outstanding balances on their credit agreements — a practice which the regulator says is widespread.

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Here's comes the seasonal blizzard of summonses from the banks - how to defend yourself

Posted 29 November 2016

This is the season to be jolly, but in January and February the hangover sets in and the banks start issuing their seasonal blizzard of summonses. Now is the time to prepare yourself.

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Another dagger at the heart of banks attempting to recover debts without original documents

Posted 22 November 2016

Here's another tale of heartache for the banks, this time involving FNB, which attempted to claim R74,144 from a customer who had acquired a vehicle by way of instalment sale. The problem is FNB arrived in court without the original documents. The judge made short work of FNB's case and booted it out of court. In this case, the defendent Adrian Hart represented himself using a DIY defence template developed by a debt defence specialist. 

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This is why you are poor

Posted 12 October 2016

This is a brief but brilliantly written video on what causes poverty. The banks are the architects of financial crises but have managed to shift blame to competitors or even to their clients. As we watch the derivatives crisis unfold at Deutsche Bank, this is a timely reminder that the next crisis could be the last for the fiat currency experiment that is now unravelling.

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100,000 South Africans' lives ruined by court repossession rules since Constitution enacted

Posted 31 August 2016

In a recent article in De Rebus, Advocate Douglas Shaw welcomes some recent changes to rules that allow courts to set reserve prices (but do not compel them). This means properties sold in execution may be sold at closer to market price. Shaw also bemoans the fact that SA's repossession regime is among the most backward in the world. More than 100,000 South Africans have had their lives ruined since the Constitution was enacted some 20 years ago.

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Banks preparing for "economic nuclear winter"

Posted 29 August 2016

The Brexit vote, leading to Britain's exit from the European Union, is likely to trigger similar calls from France, Netherlands and other European countries tethered to a sinking economic union and a dodgy Euro. Bank stocks are already seriously under pressure from weak corporate earnings and economic uncertainty. According to this report from CNBC, banks are now preparing for the worst.

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The biggest power grab by bureaucracy yet

Posted 24 August 2016

You give a piece of legislation a name like the Financial Services Regulation Bill and you know people will yawn and turn the page. Yet buried in this proposed law are some whoppers. We are going to get not one, but two, giant bureaucracies that will cost between R4bn and R6bn a year, paid for of course by the consumer. We are adding layer upon layer of regulation in a fruitless attempt to prevent future financial crises. Nobel laureate George Stigler investigated the economic costs of regulation and came to the conclusion that bureaucracies often end up performing no discernible public good, or what he called regulatory capture.

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Sasfin's photocopier deal turns out to be a whopper

Posted 08 August 2016

Asset manager and chartered accountant Sunil Shah didn't read the fine print when signing an agreemernt for the rental of a photocopy machine with a Sasfin-associated finance company. So a machine that was advertised on the internet for R7,500 ended up costing him R15,000 even though he delivered it back to the company after just three months. This is because of loopholes that allow these rental companies to side-step the National Credit Act. BizNews reports on how this happened.

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How to check if your bank is ripping you off

Posted 29 June 2016

In this article Armand Rinier looks at how banks and other lenders are engaging in reckless lending. The practice is so common, it would require a book to cover all the creative ways banks are breaking the law. It's time to pull out your bank statements and see whether or not you are being gouged by the banks. 

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How to defend yourself against the banks

Posted 21 June 2016

If every debtor served with a summons defended the action, it would choke the legal system and force the banks to come up with better solutions for customers who have difficulties in meeting their monthly payments. It's an actuarial fact that the average mortgage borrower will either default or settle the bond within seven years. Banks know this. Despite well-intentioned laws, lenders are engaging in reckless lending on a daily basis. In this regular weekly column, Debt Nurse Armand Rinier will explain how to effectively protect your rights and assets when under threat from the banks.

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Why are so many bankers committing suicide?

Posted 14 June 2016

Michael Gray has brought out a documentary The Banker Suicides, questioning whether the dozens of banker "suicides" since 2007 were actually suicides, whether they were stress-related, or was there something more sinister afoot. In several of these suicides, there are common threads and connections that went previously undetected.  

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Klatzow to take on FNB in class action

Posted 01 June 2016

A forensic scientist is planning to bring a class action suit against FNB over its systemic failure to represent its clients' interests on online banking fraud cases. The trigger for this was an attempt by FNB to reach a partial rather than a full settlement of a client's claim that R300,000 was stolen out of her account. FNB attempted to push at least some of the blame on the client. 

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The fight back begins, Greek activists block home foreclosures

Posted 28 May 2016

Where is South Africa's spirit of protest over outrageous bank behaviour in removing people from their homes? Greek activists have taken to protesting outside court houses and successfully blocked 800 home repossessions in the process. Perhaps South Africans will wake up from their slumber and start a similar movement here. Any takers? 

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Capitec accused of reckless lending

Posted 05 May 2016

Capitec is accused of making unjustified revenues of more than R1bn through its so-called multi-loan products. The accuser is Summit Financial Partners, which advises low income consumers with financial advice. The multi-loan products being sold by Capitec are claimed to generate margins of between 150% and 500%, according to Business Day.

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The economic underworld of bankruptcy for profit - Part 2

Posted 26 April 2016

In the second part of this series, William Black testifies before the Inquiry into the banking crisis in Ireland. He talks from a US perspective, but explains how to tell when banks are behaving recklessly (when their loan books are growing faster than the economy), how bankers have lobbied politicians to get rid of pesky legislation that inhibits their gambling instincts and how they have managed to avoid going to jail. This is fascinating testimony into the dark heart of modern banking.  

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