There is money to be made in stock market trading, but when the promise of riches comes in the form of a hard sell from a salesman peddling an online course, you’d do well to remember Mark Twain’s advice on how to double your money: “Fold it over once and put it back in your pocket.”
So compelling was the sales pitch for an online trading software package that cancer-stricken pensioner Rodger Stonehouse abandoned his usual caution and handed his credit card to two salespeople.
After speaking to him on the phone, they travelled more than 400km from the Bellville headquarters of Ismega to his home in Great Brak River to convince him that it was a great investment.
That was in September 2016. They left him with a box containing a tablet, loaded with an analytical JSE monitoring software programme, an undertaking to set up training the following month and his signed authority to debit his credit card monthly for the next six years.
Within hours almost R22 000 was debited, followed by monthly debits of R275.
It was only in June this year, after Stonehouse’s death, that his wife and daughter, Samantha Croft, discovered the courier package containing the tablet in its still-sealed box, and began to investigate.
Within two days of signing the contract, Stonehouse had had a change of heart and sent a cancellation e-mail to Ismega.
“I have decided that online trading is not for me and wish to cancel in terms of the Consumer Protection Act,” he wrote.
Debits after death
He paid a courier company to return the unopened tablet to Ismega, but according to Croft, the courier company reported that twice when they attempted to deliver the package to Ismega employees they refused to show their identity documents to accept it. The package was eventually sent back to Stonehouse.
And the contract remained in force; not only did he not receive the refund he was legally entitled to, but the monthly debits continued, even after the company was informed of his death. His bank account couldn’t be closed until an executor had been appointed.
“Two months after my father sent that cancellation email, he received a response from Ismega, saying that they are covered by the Copyright Protection Act,which doesn’t appear to exist,” Croft said.
By the time Money took up the case in September, Ismega had taken about R25 000 from Stonehouse’s credit card.
An e-mail exchange with Ismega’s legal adviser, Mimette Scott, took place over many weeks.
She began by disputing the claim that a courier attempted to deliver the packaged tablet to Ismega on two occasions, saying there was no CCTV footage of that.
“I am of the opinion that the parcel was never sent to the correct address or company,” she said.
When proof was produced – a photo showing that the parcel was correctly addressed, with courier correspondence attesting to attempted delivery – Scott said the contract could not be cancelled because the software had been opened and/or installed. This was after being sent photos of the boxed tablet with its original seals intact.
Conceding she was mistaken on that point, she asked for the tablet to be sent to her “for inspection”.
Croft complied and Scott acknowledged receipt, but it was another week before she responded, saying she was “extremely busy”.
Finally she agreed to cancel the contract and refund the money deducted from Stonehouse’s account for a year, to his estate. But there was a kicker. An “admin fee” of R1950 would be deducted, she said, as allowed for by the CPA.
‘The supplier may charge the consumer a reasonable amount to necessary restoration costs to render the goods fit for re-stocking.”
This despite the tablet having been returned unopened.
“The financial industry is teeming with advisers who are driven by making money from their clients rather than for them,” warned David Shapiro of Sasfin Securities.
“They are able to succeed simply because 99.9% of the population is financially illiterate and gullible,” said Shapiro.
“They have absolutely no idea of the risks involved in the products they sign up for, and the commission-driven salespeople lack conscience,” he said.
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