Debt counsellors who fail to comply with the National Credit Act (NCA) will be firmly dealt with, the National Credit Regulator (NCR) showed this week when it struck from the register an errant counsellor. Two other counsellors were placed under investigation in September.
Cape Town debt counsellor Zolile Senior Njokweni's registration with the NCR was cancelled with immediate effect.
Jan Augustyn, the manager of investigations and prosecutions at the NCR, says an investigation into Njokweni's practices was provoked by several complaints from his clients.
"We take complaints about debt counsellors very seriously as they are the last resort for over-indebted consumers who need help. Often, when counsellors fail to do their jobs properly, it is the consumers who suffer - when creditors take legal action against them. This is unacceptable," he says.
An important requirement of the NCA is that debt counsellors must have access to adequate infrastructure to provide a professional counselling service.
"Njokweni operated from several temporary offices, including the parliamentary buildings and his home, which made it difficult for clients to contact him," Augustyn says.
The NCR found that Njokweni was not complying with the law in that he had failed to:
- Notify credit providers and credit bureaus of debt counselling applications within five days of receiving the application; and
- Determine whether consumers were over-indebted within the required 30-day period after receiving their applications.
Njokweni has been ordered to hand over all his clients' debt review files to the NCR and to refund clients any fees paid to him.
Another two debt counsellors, Ralph Zulu of GNR and Associates in KwaZulu-Natal and Barry Kotze in Centurion, are under investigation until March next year, when the National Consumer Tribunal will decide whether or not to cancel their registrations.