For years the IFP has identified how banks, insurance companies and, in general, the financial sectors are not contributing towards our country's economic development, but are actually hindering it, by increasing the cost of doing business on account of the prices of the services they provide.
The same applies to cellular companies which, in spite of having one of the most receptive cell phone markets in the world, have managed to impose on South Africa one of the highest costs of telecommunications.
This state of affairs is the product of Government's inaction and complicity, even though Minister Rob Davies has often stated sentiments similar to my criticism about the position of immunity which these three industries seem to enjoy, not only in respect of our competition laws but also in respect of laws relating to consumer protection and international competition.
Last month, I spoke about this in Parliament and identified two specific instances dealing with the cell phone industry. I indicated then that even someone like me, a Member of Parliament, has been the victim of what appears to be extortion on the side of Vodacom, which forced me to pay an extremely high bill for data roaming without being able to justify any of it, and did so under the threat of wrongfully suspending my parliamentary telephone.
I also denounced a possibly fraudulent and surely aggressive marketing scheme conducted on behalf of Cell C, of which my wife became the victim. In reaction to my public complaint, Cell C was very responsive and acknowledged and committed itself to fixing the problem. This made me reflect in what happens to the many South Africans who do not have the benefit of a spouse being a Member of Parliament and nonetheless become victims of such conduct as much as my wife and I did.
Therefore, the IFP has launched a website called www.daylightrobbery.org in which we invite South Africans to lodge their own horror stories when dealing with insurance companies, banks and telephone companies. This started as an IFP initiative, but is not meant to remain such, as we wish only to be the catalyst to bring together a broader alliance of other political parties, consumer groups, stakeholders and relevant organs of State.
Our commitment as parliamentarians is that of collecting all the complaints we receive and bringing them to the attention of the Consumer Protection Commission, Minister Rob Davies MP and the Chairman of the Trade and Industry Committee, the Hon. Joanmariae Fubbs, MP.
When I addressed him on these issues in Parliament, Minister Rob Davies shielded himself from responsibility for the matter stating that any such problems need to be addressed by the Consumer Protection Commission. The Consumer Protection Commission is overburdened, underfunded and under-resourced, and is likely to remain that way for the next decade. Therefore a partnership among consumer groups, affected victims, organs of State and parliamentarians is necessary to supplement what the Consumer Protection Commission may or may not do.
However, more fundamental policy issues are responsible for the present lamentable state of affairs and they must be addressed at the policy and legislative level. It is obvious to any independent observer that South African banks are implicitly or explicitly colluding with one another to provide services at a much higher price than international standards, and they are allowed to do so because they are protected from international competition and new market entities by Government's laws and regulations.
When I confronted him with this issue, Minister Rob Davies replied that the Competition Commission is looking into the matter. Yet, two years ago, the Competition Commission was about to release its report on our banking system and held it back for fear that it may upset our markets during a period of recession. This shows how banks are treated with velvet gloves.
The system is not working and must be rectified. The enforcement of anti-trust and competition laws cannot be left in the hands of Government alone. There is need for private actions to be rewarded with punitive damages, as happens in other countries.
We have run www.daylightrobbery.org on a pilot basis for about ten days. We have printed some of the complaints we have received, which are set out hereinafter. This is just the tip of the iceberg. The picture they show is one of Government conniving with these three industries to enable them to operate as they wish without the restraints of competition and without sufficient legal protection for consumers. The notion of believing that there is protection in respect of banks and insurance companies merely because these two industries have established their own self-appointed and self-interested ombudsman is absurd.
I do not believe that the solution to our problems lies in what Government can do. More often than not, Government compounds rather than solves our problems. We need to have laws which enable us, the citizens, to fight against the big industrial giants and win when we are right. For instance, it would sufficient to make provision for class actions against these three industries which could be brought by citizens in a context in which the applicants do not need to pay the opponents' legal fee if their application is dismissed and may receive punitive damages, such as triple damages, if they succeed.
However, before any such solutions can even be proposed or discussed, we need to create greater awareness within our Government circles and among the people of South Africa about the nature and extent of this problem and the fact that so many countries have solved it. This is what the website www.daylightrobbery.org hopes to achieve.
I was forced to have an insurance contract to get a loan. When I paid off the loan, they would not cancel my insurance contract. Bastards!
Help! Are there any medical insurance companies that show respect for their paying customers? Recently I was over-charged (x3) by my medical insurance company which not surprisingly has made every effort to ensure that I don't spend their (my) money. They told me that I could only have the money reversed to my account within 5 to 10 working days! So, I could not afford to pay my municipal account because of their mistake. When I asked them to refund me sooner, they said a refund would mean that I would lose my cover for the month and partial refund would also take 5 to 10 working days. Was like talking to a brick wall. Ughhh. Why talk to an insurance company?
The cost of insurance in SA are some of the highest in the world and nobody seems to be able to explain why. There has been no real investigation into whether this is the product of lack of competition or collusive conduct on the side of the insurance companies. Profit margins for the largest insurance companies in our country are some of the largest in the world!! By joining the dots, the picture that emerges is one of excessive pricing allowed to exist because of government's lack of enforcement and our weak ineffective competition law.
As if it's not enough to be subjected to the abuses of banks and insurance companies, we also need to be subjected to the combined abuse of the two of them. I was required by FNB to carry insurance on my house when I took out a mortgage. I paid off my mortgage and FNB would not allow me to cancel my insurance with Outsurance. Only when I threatened to go to court did they allow me to do so. Outsurance and FNB are part of the same group and I was referred to Outsurance automatically when taking out my mortgage. A problem developed with my house and Outsurance refused to pay for no rhyme or reason, but I did not have the strength to take them to court. I was also afraid that by challenging Outsurance I could jeopardise my home loan before I paid it off.
The insurance ombudsman is a scam - paid by the Insurance companies and operates for the company's benefit. I felt the full brunt of its incompetence, bias and unwillingness to deal with matters seriously. They lost my documentation four times and in the end ruled against me on the basis of my not having provided documentation. I insured my house against any structural failure. A retaining wall fell, and the insurer first argued that there must have been pre-existing cause. When I provided irrefutable proof of that not being the case, the insurer argued that the cause must have been acting progressively even though the collapse was sudden and that the policy only covered sudden causes, which was just not true. The house was inspected by the insurer before the policy was issued and no exception or reservation was made. Retaining walls are not meant to collapse, and this one had been in place and functioned properly for over 20 years. The insurer then demanded that I be the one to explain why and how the wall had collapsed, even though under any principle of law, all I had to do was prove the occurrence while it is the burden of the insurance to prove that the occurrence took place for recourse that they did not cover, such as acts of God, or force majeure. Confronted with these basic issues, the insurance ombudsman just ruled against me, without addressing any of them or possibly even understanding them. We need an ombudsman established by law and acting in the interest of the public.
South African law prohibits insurance companies from providing an insurance product which is common throughout the Western world, namely Life Insurance coupled with a Retirement Plan. This type of insurance enables one to make payments while one is productive and receive payment not only upon death, but also when one reaches a certain age, usually at 70 years. If one doesn't reach the date, the insurance company pays out only the payment that is due upon death. This is effectively the best product for consumers.
However, this has been prohibited in South Africa, to force consumers to buy two different products, namely Annuity and Life Insurance, at double the price. This is another gift the South African government has given to the insurance industry at the expense of consumers. To double the gift, several regulations make it either illegal or impossible for SA consumers to buy such insurance products from foreign companies or for such foreign companies to sell it in the SA market. This is another case in which government regards the consumer as 'cows to be milked' for the benefit of the parasitical financial sector.
I was travelling overseas and received from Vodacom a R30 000 bill for data roaming. I enquired as per where, when and how the charges were incurred, pointing out that I have, on my account, two sim cards with data-roaming capability which are used by two different people. Most of my travelling was in the US where AT&T, which is a US company to which my Vodacom account automatically links, no longer charges on the basis of consumption, but only charges a flat monthly fee, which is extremely low.
Vodacom was unable to explain to me which sim card incurred the charges and when and where the charges were incurred, and yet expected me to pay the bill. When I pointed out that as a mater of general law, any invoice is due only when it details amounts of goods or services provided and received, Vodacom did not dispute my contention. I went further, inviting Vodacom to point to any contractual provision in its service agreement which would depart from such principle of law, and I received no reply or indication.
They proceeded to suspend my account when my bill was not timely paid in spite of their not having identified any legal date on which their data-roaming bill was due and payable. They indicated that they would only resume my telephone service if the data-roaming bill was paid. I paid the bill under protest, requesting them to show cause as per why I should not construe their conduct as a case of extortion, since I was told to make a payment which was not due and payable, under the threat of wrongful conduct on their side. I received no reply. Under the circumstances I am considering reporting the matter to the police, requesting them to assess whether Vodacom's conduct embodies the elements of the crime of extortion.
My cellphone was stolen and I still had to pay for the monthly debits for it for another year because I was locked into a contract. without having a phone and even tho it was blacklisted and had a police report case #. Is this fair?
Banks sell our property to a third party - when we take out a loan, they make loads of money out of us! Google www.jojou.cc! I hate them for being secret about it all this time.
My mother sent me Euro 5000 from Europe. She made a mistake and sent the money to the wrong account. Having been contacted, the recipient correctly rejected the money which, a week later, was returned to my mother. She sent the money with all expenses and fees being carried by her, but she only received Euro 4500. When Nedbank was asked to explain how this could be possible they had the impudence of insisting that it was due to exchange rates and the differential between the purchase and selling price of currency. Yet there was no fluctuation in the exchange rate in that period and the Euro were never converted to Rand because the recipient refused to give the clearance required by the SARB. Documentation on all this is available. The Euro 500, which is 10% of the entire transfer was just kept by Nedbank with no further explanation given or feeling the need to give an explanation which would stand scrutiny. If you and I did that, somebody would charge us with a crime.
For 15 years, I have been regularly importing money into South Africa for one reason or the other. The SA government and its laws prohibit my bank from giving me the foreign currency which I import and I am obliged to convert it to Rands if I want to deposit it into my bank account and use it.
For 15 years, in spite of my most vociferous protestations, FNB has converted my money from dollars or euros into rands at an exchange rate way above the mid-market rate applicable at that time at www.xe.com, and even much higher than what any American Express, or Thompson Travel in Cape Town and Jhb would give to any tourist bringing their forex to them at that time.
I punctiliously check these every time. If I, as a member of the public, had a dollar in hand and could bring it to American Express, I would receive slightly more than what my bank, with whom I have done business for 20 years and which holds me on platinum status, is prepared to give me. Having investigated the matter, I realise that the other three banks do exactly the same, and get away with it because of a cartel. If the exchange Control Act were not there, we could choose where to exchange our forex, the same way as tourists do. Instead, the government forces us to pay indirect taxes straight into the pockets of our bankers!