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Car sale executive liable for lies about vehicles

Fuseworks Media
Fuseworks Media

Wellington, Oct 12 NZPA - The managing director of a Porirua car dealership has been held personally liable for breaches of consumer law after false information was entered on consumer information notices for vehicles sold by the company, Sunrise Motor Group Ltd.

The company executive, Surya Kumar, was fined a total of $9600 on six charges and Sunrise Motor Group a total of $19,200 on 12 charges in Wellington District Court today after pleading guilty to multiple charges of breaching the Fair Trading Act.

The charges related to failures to comply with Consumer Information Standards (Used Motor Vehicles) Regulations 2008 and false claims made by Kumar and Sunrise about damaged vehicles sold to consumers.

In November and December 2009 Sunrise Motor Group advertised 18 motor vehicles on Trade Me without displaying or providing access to consumer information notices (CIN) as required by law.

This was shortly after Trade Me chief executive Jon Macdonald (CRCT) told parliamentarians Trade Me listed 500 vehicles a day for auction "for your average mum and dad" and the same sort of sellers listed another 500 cars in classified listings, with a further 500 classifieds for car dealers.

Mr Macdonald noted that in theory all the 175,000 motor vehicle auctions annually on the website should include a consumer information notice (CIN), and it told the sellers this.

"However the reality is different," he said.

The notice was previously called a supplier information notice (SIN) but the Commerce Commission had said in 2006 it only enforced the requirement against motor vehicle traders, and the Consumer Affairs Ministry recommended in 2007 the requirement be removed.

But the commission said today that six times between June and November 2009, Kumar and Sunrise Motor Group falsely claimed that vehicles had not been imported in a damaged condition, when in fact they had. The company twice failed to complete the mandatory information box on the CIN in relation to vehicles which had been imported in a damaged condition and when questioned by prospective buyers, Sunrise Motor Group and Kumar made "false representations" about the damage.

Kumar was personally liable for entering false information on the CINs and for the false statements he made to prospective purchasers.

"When traders are questioned about the products they sell, they must answer truthfully," said the commission's general manager of enforcement, Kate Morrison.

"Not just the company, but also the individual making false and misleading representations, can be prosecuted," she said.

"Buyers are entitled to have correct information ... traders must ensure that consumers have access to correct and complete CINs for all used motor vehicles offered or displayed for sale".

On August 25 this year, the Commission wrote to about 2500 registered motor vehicle traders reminding them of their obligations in relation to the CIN regulations. It also published a warning for Trade Me advertisers who sell more than six motor vehicles within a 12 month period: a threshold that requires them to be registered as a motor vehicle trader.

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