June 2011 Debtfree DIGI

Debtfree South Africa’s debt counselling magazine

June 2011 www.debtcounsellingsa.co.za

YEARS

opposition to the process while others are seeing record recoveries of funds through the process. What the future holds for the industry is still unsure. This year has things swing (legally) from keeping legal costs down for the consumer to legal fees potentially going back 02 Editors notes up. Whether or not this negatively impacts on the industry will depend on many factors.

03 News The recent FRB vs Collett ruling has seen some rash creditors sending another flood of 86(10) 05 I have to go to Court termination letters out much like at the end of 2010. Shortsighted this may be but it is simply 08 Collet v Firstrand Bank another day at the office for the Debt Counsellor and good news for attorneys (not so much for 10 The end of debt review? consumers and credit providers). The number 14 DCASA Western Cape of people applying for debt review has slowed over the last few months and many DC’s are 16 Klerksdorp Magistrates feeling the pressure of covering overheads and recent delays over fee increases is a concern for 20 DCA the larger DC firms.

However improved DC representation, complaints channels and credit provider accountability as well as local magistrates starting to become familiar with the process is really helping. True, it is unfortunate that consumers continue to face the challenges of increasing prices of basic needs and bad 4 years of debt counselling. Wow! For treatment from some CP’s. All that said Debt thousands of South Africans it has been a life Counselling continues to tick along in SA and line to sanity and financial freedom. A means has helped many thousands of consumers out to get their lives back on track. For some of a tight spot. Some consumers now even it was a brief help just when they needed it bravely answer calls from “unknown numbers”. most. For others it is an ongoing way of life So hang on in there, insist on your rights and that is slowly bringing them closer to their keep your debt repayments on track. Maybe goal of being debt free. this year you could be debt free.

For the many credit providers out there, it has either been a great debt collection mechanism or a nightmare of dodging and diving trying to get out of the process. Some Creditors like Nedbank, FNB and ABSA continue their

CONTENTS

EDITOR

INDUSTRY

CONSUMER

NEWS FLASH FRB VS Collett goes against the consumer The judgment on 86 (10) matters that are already set down at Magistrates court has been handed down in the FNB Vs Collet matter. The Judgment says that credit providers can terminate debt reviews and that consumers can then ask the courts re-included the account. What this really means is more legal costs to the consumer which will delay payments to Creditors. DC’s country wide report an influx of “Termination” letters. Tony Richards of DCASA says that this decision “is going to further disenfranchise the poor” It appears that the matter will now be appealed at the Constitutional Court

through the Magistrates Courts. At present there have been over 270 000 applications for debt review. Make sure your DC has obtained a court date for your debt review matter.

Dont forget the DCASA AGM DCASA’s 3rd Annual General Meeting and Conference details below: Date: Wednesday, 17 August 2011, Time: 8H00 till 16H00, Venue: Emperor’s Palace, Kempton Park.

DCRS sytem hits 60% solve rate The new debt restructuring calculation software option backed by BASA and available through 2 of the PDAs at present is called DCRS. Peter Setou- no new info The NCR have not released any further It has recently been available for DC’s to use to information about Mr Setou’s recent leave of try speed the process. Many consumers have absence. DCASA have commented that they already benefited from the new restructuring only know what they read in the newspapers. rules engine which was implemented in February 2011. Since inception a reasonable number of about 1400 repayment plans were submitted to DCRS and the acceptance rate is DCRS- system limitations DC’s should note that the DCRS system which around 60%. This means that in 840 cases with some PDA’s are making available for DC’s to the click of a button the amount calculated use to calculate proposals does not take into to repay the debts was sufficient for the account NCA Sect 103(5)- which is commonly repayment plan to solve in time periods the creditors would prefer and thus automatically referred to as the induplum rule be accepted by the credit providers involved.

The other 40% will have to be resolved the usual way (via court and through a bit of Get me to the court on time The latest statistics regarding courts hearing negotiation). debt review matters have been released and it appears that 26 425 cases have been resolved

Western Cape DC Forum to meet Meeting to be held at Parow Golf club 12h00 Wednesday 22 June 2011. Meeting Facilitator: Simon H Barkenhuizen. Discussion: Forum’s name finalized; Committee members; Vision of Forum; Feedback on DTI Meeting. All Debt Counsellor’s are welcome, kindly RSVP as soon as possible. RSVP to: debtrelief@steyncoetzee. co.za

The South African Fraud Prevention Service ordered by court to register as a credit bureau The National Credit Regulator (NCR) has won an important case in the Pretoria High Court relating to the South African Fraud Prevention Service (SAFPS). The SAFPS is a not-forprofit membership association focused on preventing financial crime. It is funded by its members’ annual membership fees, many of whom are credit providers. On 19 February 2010, the National Consumer Tribunal (NCT) found that SAFPS did not have to register as a credit bureau; however, the NCR disagreed and took the matter on review to the North Gauteng High Court, Pretoria. On Thursday, 26 May 2011, Judge Legodi reviewed the Tribunal’s decision and set it aside. He also declared that the SAFPS had contravened the provisions of section 43 (registration of credit bureaux) of the National Credit Act (NCA). The court directed the SAFPS to lodge an application for registration as a credit bureau within 21 days.

SAFPS was also ordered to pay the costs of the application. Failing this, it will be ordered to cease its operations in so far as receiving and submitting reports from any credit provider is concerned. “The court found that the annual membership fees paid by credit providers to the SAFPS were indeed payment in terms of

the NCA,” says Adv. Jan Augustyn, Manager for Investigations and Enforcement at the National Credit Regulator. “It also found that the business of the SAFPS falls under that of a credit bureau under the National Credit Act and that the information that is being held by SAFPS on their database and as provided by credit providers is indeed credit information in terms of the Act.” Augustyn says the court’s decision shows that the collection of consumers’ credit information must be regulated and protected.

How Many DC’s are there out there?

The NCR recently called for DC’s to update their info for their website. Only 460 responses were received. This might be an indication that though many people have qualified as DC’s not many are practicing as such.

DCASA meetings June 2011 DCASA Branch Meeting dates for June 2011: 8 June - Gauteng Meeting at 13H00 at Kempton Park Golf Club. 13 June - KwaZulu Natal Meeting at 10H00 at the Westville Country Club. 13 June - Limpopo Meeting: Venue and time to be confirmed. 23 June - Western Cape Meeting at 11H00 at Parow Country Club. 30 June Eastern Cape Meeting. Venue to be confirmed.

For more information on the meetings, contact DCASA at dcasa@dcasa.co.za or 086 143 2272.

CONSUMER

ARGH ! MY DEBT COUNSELLOR SAYS I HAVE TO GO TO COURT It seems so glamorous on TV but when your Debt Counsellor (DC) tells you that you may need to go to court it can leave you feeling cold inside. It seems very scary.

Well, the good news for many consumers is that they may not have to go to court at all. Most magistrates are happy with a Confirmatory Affidavit from the consumer who they realise might need to be at work at that time. Other Magistrates would like to see the consumer who is involved.

First off, do not be afraid. Think of a court

as a type of business. A business where the Magistrate is the “Boss” and everyone else is “staff”. In this scenario strangely you are the “customer”. Does that make you feel more relaxed? A little maybe...but what does the Magistrate want from you? Why do you have to be there in the first place?

Many Magistrates are concerned that consumers know what is going on with their debt review. Magistrates do not want to see consumers having orders granted when they do not know or understand the ramifications of

what is involved. Normally a Magistrate will not “grill” you, asking you difficult questions. The may ask you a few questions relating to your general financial situation. They may home in on a specific expense mentioned in your budget section as proposed by the DC. “Why are your call costs so high Mr. Over indebted ?” asks the Magistrate. “Well, your Worship, I use my phone for work. I need to make lots of calls while I am out of the office. It is a part of my job”, answers Mr. Over indebted.” Ok” says the Magistrate. They may also want to know if you realise that there are fees involved and that you cannot miss payments. They may ask if you understand the process. If you don’t, ask your DC to explain it to you again (before you go).

Some Magistrates even invite consumers into their office (along with their attorneys) to discuss things in a more relaxed setting.

Remember much like the National Credit Act the consumer is the focus of the case and the law is there to try help you. All the Magistrate wants to know is that you understand the matter and will take the new payment arrangement seriously.

Your DC or Attorney will be able to tell you where to go and when to arrive. Come early and be prepared to wait. It can be tricky to get time off and sometimes your matter is heard before 10 am but Courts are very busy places and realise that you may sit there most of the day (maybe bring a book) your matter may not even get finalised the first time. Be respectful, dress nice and don’t be afraid. Thousands of people country-wide go to court everyday.

Today is just your turn and once it is done you will have that ever important Court Order.

So Debt Counsellors want specialised ATTORNEYS who can sort out all their DEBT COUNSELLING needs...

RM Brown & associates

www.rmbrown.co.za

COLLET V FIRSTRAND BANK terminations.

What the judgment essentially does is this:

The vexed issue of section 86(10) terminations was once again considered, this time by the Supreme Court of Appeal in the matter Collet v Firstrand Bank and the National Credit Regulator (766/2010) [2011] ZASCA 78. As it is a decision of the Supreme Court of Appeal it is now authority on the issue of section 86(10)

1. It finds that if the consumer approaches a debt counsellor before he falls into default of his obligations in respect of the credit agreement then the debt review cannot be terminated while the consumer remains in good standing. This is most unlikely scenario given that consumers who are over-indebted are unlikely to remain in good standing; 2. If the consumer is in default(the likely scenario) then the credit provider can terminate after 60 business days have elapsed. It does not matter if the debt review application is in court or not.

The 60 days is a moratorium within which the parties may attempt to resolve their dispute.

The court therefore rejects the Western Cape full bench decision of Wesbank v Papier 2011 (2) SA 395 (WCC) and confirmed that there is no time limit for the debt counsellor to bring the debt review application to court; 3. The court then emphasised the obligation of both the consumer and the credit provider to comply with the reasonable requests of the debt counsellor to facilitate an evaluation of the consumers indebtedness and the prospects of reasonable debt restructuring as well as the obligation for both parties to participate in good

faith in the review and the negotiations. Should the credit provider fail or refuse to participate in the review, a resumption of the process may well be ordered. But where the credit provider on good grounds concludes that the proposed restructuring will not lead to the satisfaction by the consumer of all responsible financial obligations or a re-arrangement, the court considering the resumption of the debt review may well refuse to sanction its resumption.

4. The court found that the court which is charged with reinstating the debt review is the court where the enforcement proceedings are being heard. This means that if the credit provider enforces a credit agreement in the High Court then the section 86(11) application would be heard in the High Court. The same applies to enforcement of credit agreements in the Magistrates Court.

5. The courts have an over-riding discretion to refuse applications for summary judgment.

Whilst the courts in this case then said that the consumer could in his affidavit opposing summary judgment request that his debt review be re-instated in terms of 86(11) on the basis of the credit providers failure to participate or its bad faith in participating, evidence would have to be presented before court to support this contention. The court also seemed to say

that the nature of the proposal could also be considered in the quest for reinstatement. If the proposal was well considered and sought to ensure that the obligations of the consumer are met in full then that would count heavily in the consumers favour.

6. Other than ensuring that the debt was repaid in full, the court set no parameters as to what constitutes a reasonable proposal.

My view would be that the parameters that should be adopted are those as set out in the Task Team Review agreement. These rules in my view would carry significant weight when the issue of what constitutes a reasonable proposal are argued. It is also unlikely that the credit provider would terminate if the proposal complies with these rules. This notwithstanding, I would argue that each matter would ultimately be judged on its own merits.

The consequence of all of this no doubt will be that the High Court Rolls will be clogged up with summary judgment arguments for those litigants who are fortunate enough to be able to bear the costs of litigation.

INDUSTRY

CONSUMER

IS FRB VS COLLETT THE END OF DEBT REVIEW? The simple answer is: no. Why should it be?

All that has been decided is that Credit providers (CP’s) can issue section 86(10) letters after 60 days and that courts can force 86(11)’s.

The CP’s were issuing these “terminations’ anyway so...nothing new there. Sure, there is

currently a spate of 86(10)’s right now as some greedy CP’s try to go after consumers assets.

However they can now only do it on accounts that were in default at the time of the debt review ,application being made. Read the judgment again you will see what we mean.

It does seem like the Judge may have been somewhat unfamiliar with the process. There are some glaring issues with the ruling, like the above. When asked for a comment about whether the proposal did or did not solve (the Honorable Judge of Appeal FR Malan seemed to think this was not the case) DC Gerhard Stoltz made this comment: “ I can confirm that the proposal did solve when the cascading is taken into account and if consideration is given to recent SCA judgment on Section 103.” We should not be harsh, it took some creditors like Nedbank about 3 years to figure out cascading and they still don’t like to deal with it. Mr Stoltz further went on to say:” I can further confirm that we have instructions to Appeal to the Constitutional Court and our application will be to ask the court for a change to the wording in the Act. We would appreciate any and all support in this matter from the Debt Counsellor fraternity.” We wish them all the best. However for now this is law as it stands.

unsecured credit departments will then suffer as little or no funds will be available to service these debts (since the houses and cars will be allocated all available funds by DC’s) and proposals for these types of debt will once again stretch over many decades. Still it is the CP’s who lose. Who knows ? That will be an issue for individual CP’s to figure out.

What those who work at the CP’s need to beware of is losing a generation of consumers due to aggressive termination and repossession policies. Take someone’s car and you will never have them as a customer again. Take their house and even their children will never do business with you. Sure many banks are flailing and need cash right now. We understand that.

However those who still want to be around in a decade need to look at their policies. This is why those at the top in these organizations support debt review as a cheap and effective collection process. Why pay attorneys 10% collection fees when the DC will arrange things So what to do? Well DC’s could set aside large for free? amounts of the consumers first few payments for potential High Court legal fees where Assets Many who work at the various CP debt review like cars and homes are concerned. No doubt departments are only now realizing that with consumers will be happy to pay a few thousand the new Central rules engine (DCRS) being Rand to try save their assets. Only the creditors available and if policies on mass terminations would really suffer. Maybe the few CP’s who try proceed they will soon be without jobs. rush through the first few Summary Judgment Computers can supply Cobs and 86(10) letters applications will not feel the ratio of cases they and legal can handle court matters. Watch out! win to those they have cost orders awarded against them is worth it. Maybe it will be worth So, no Debt review is not over. The recent it. Truth is, for the consumer who is in trouble judgment may mean a little more legal work it makes no difference if they lose their home for a while but as DC’s adjust debt review will now or in a few months. At least they will continue helping CP’s and consumers alike. have tried to be responsible and try make an arrangement. If these asset product houses start winning cases left, right and centre the

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INDUSTRY

CONSUMER

DCASA WESTERN CAPE- LATEST DCASA Western Cape was rocked last month when almost all the senior members of the local DCASA committee stepped down in protest to what they called “being marginalised” by the DCASA leadership in Gauteng. As a result these former DCASA members have formed what is called a Forum for Debt Counsellors who are disillusioned with the representation that DCASA offers.

After the recent ruckus within DCASA Western Cape it seems it was time to pull out the big guns with Tony Richards and Andre Snyman two senior members of the Associations National Executive Committee (NEC) who have seldom been seen in the Cape attending the most recent DCASA meeting there. The meeting was held in Parow, Western Cape in an effort to help smooth things over within the Association.

Both Tony and Andre seemed pleasantly surprised at the friendly reception they received. Perhaps because of the seriousness of the recent upheaval they expected pitch forks and fire brands however in typical Cape Town fashion those attending were very laid back and relaxed. While there were some pointed questions asked (and answered) the mood was one of concern for the industry rather than a blame game.

by Octogen (one of the Big Debt Counselling firms in SA) and while Tony Richards did call DCASA his “little baby” and refer to members of DCASA as “his guys” he also said that if the members of DCASA did not want him to take a leadership role he would be “quite happy to step down”. He even went on to say that “Paul and Mel would also be willing to step down”.

Tony spent a considerable time describing the democratic nature of the association encouraging DCASA Western Cape to ensure it’s voice is heard by having more DC’s join the association so that they too could vote and help direct the organisation. Tony mentioned that unlike many other DC firms all Octogen DC’s were members and this may have something to do with the seeming imbalance. Once again he reiterated that if need be he would step down. “It is not my organisation... I am tired of DCASA... it is my little hobby. I don’t get paid for it” he said.

One former member of the previous committee attended the meeting and once again asked why information requested (particularly about funds available) had not been provided to the committee.

Tony answered that this information had not been provided because of concern that committee members (at that time) would then disseminate this information to non members or possibly rival associations or the Many accusations have flown about in regard press. He explained “I don’t want that info to whether things at the highest level of out there... going into newspapers”. What the DCASA are done unilaterally by Tony and information was he did not specify. Tony said whether DCASA is simply an association run he was concerned about this after a recent

bad experience with the SDC (another new association for DC’s). He claims that after two meetings with them and giving the SDC a lot of sensitive material they simply cut off communication and now refuse to deal further with DCASA. Concerns were raised regarding poor communication. To which tony admitted: “ communication has been bad”. However both he and Andre committed to improving this “somehow”. They pointed to the monthly newsletter as a step in the right direction.

very little resignations in Gauteng.”

In regard to the delay in a DC fee increase it was revealed that the NEC had gone to the NCR with no joy and are now considering legal action.

The meeting culminated in the election of an interim committee to oversee things till the 24th of June when there will be another meeting in the region and an official vote for a permanent committee. Only 7 members of the audience volunteered to stand for temporary election. Which was fortunate since there were When asked about the proposed fee structure 7 spots to fill. Of those elected 2 are non DC’s change and PDA fees, Tony said that none of and one is an Octogen member. It remains to the previous W Cape committee had opposed be seen if another new group can overcome the the proposal at the NEC meetings. They were issues that have faced previous committees. only doing so now. He stated that the real reason for the current problems is that Mr Barkenhuizen wanted DCASA support to do away with PDA’s and that DCASA had decided that the NCR would never support such a move. “Gabriel Davel created PDA’s “ was one comment by Tony. He pointed to this lack of backing as the reason why Simon Barkenhuizen had stepped down from DCASA W Cape. “We welcome any investigation. It is easy to make wild accusations and statements (referring to the “open letter”) If I have done wrong, I am out of here” said Tony.

Is DCASA worried about a possible new association? Tony answers : “ we lost 3 members from W Cape” since the storm out at the previous meeting. “one from KZN ...and

INDUSTRY

KLERKSDORP MAGISTRATES COURT REVIEW

In the review of the Magistrates Court’s nationwide, in specific how they deal with debt review applications it has become apparent that not all courts operate the same or handle debt restructuring applications in terms of Section 79,86(7)(c)(ii), 86(8), 87(1)(b)(ii) of the National Credit act 34 of 2005 the same.

This article will endeavour to bring some clarity on the Magistrates Court for the District of Klerksdorp and what procedures, documents and important do’s and don’ts there are to lodge a debt restructuring application and at the end to obtain a successful debt restructuring order.

As all courts, the Klerksdorp Magistrates Court is an independent court that derives it’s authority from the Constitution of South Africa and appropriate legislation. It should be remembered that in debt restructuring applications the Magistrate’s Court does not act in an administrive role, but rather in a judicial role. This means that cases will be heard in a formal court of law and the necessary rules of the Magistrate’s Court Act 32 of 1944 and

appropriate amendment should be followed.

What makes the Klerksdorp Court notable is the fact that from 2007 to late 2010 all debt restructuring cases were heard Monday to Friday by a rotating set of Magistrates, but at the end of 2010 it was announced that all debt restructuring cases will solely be heard on Friday’s by one Magistrate, her Lordship Pillay.

This announcement has not been met with full acceptance by the local debt counsellors and their attorneys as it has caused a backlog in cases on roll. Prior to the announcement debt restructuring cases were put on roll and heard on average within 2 to 3 weeks. Now that debt restructuring cases are only heard on Fridays, the back log on cases has escalated and debt restructuring cases will on average only be heard in about 2 to 3 months time. This lead to many debt review application being terminated after the 60 day processing time had expired. (Fortunately the High Court Ruling of Papier Vs. Wesbank temporarily solved this problem by keeping credit providers from terminating debt review process when they are refered to the court by debt counsellors).

The announcement was not only met with negative praise. Some feel the fact that Lordship Pillay, who was appointed as sole Magistrate to hear debt review cases, brings a sense of surety and ease of mind, because Lordship Pillay has a wealth of knowledge in regards to debt review cases as she handles all the districts cases and as a result sees many dynamic situations. Magistrate Pillay is also

know for keeping up to date with Higher Court Judgments that ensure an accurate and fair order in this court. It should however be noted that Magistrate Pillay WILL speak her mind and demand a VERY thorough debt restructuring application before making an order. With the appointment of Magistrate Pillay as the ‘debt review’ Magistrate , the page count of debt restructuring applications to court has raised from 15 pages to a average of 40 pages, a sure testament to her thoroughness.

The Klerksdorp court is not immune to the problems that face most courts, such as unhelpful clerks that treat you as if they are doing you a huge favour by listening to you and filing court documents. Thankfully the clerk of the civil court, Poppie, as she is known that deals with the debt restructuring cases is very helpful and supplies case numbers, court dates and files without hassle.

There are a couple of definite do’s and don’ts in this court. For example: Definitely DO! 1. File a very thorough debt restructuring application with 1.1. Notice of Motion, indicating legal section for applications 1.2. A filing Index and paginated pages 1.3. A Founding Affidavit by the debt counsellor 1.4. A Confirming Affidavit by the consumer 1.5. Annexure’s such as COB’s, Form 17.1/2, proposal, proof of sending all documents, all responses received from creditors in regards to the proposal and so forth.

2. Make sure you find out where debt review cases will be heard prior to the hearing date 3. Make sure the clerk of the court has opened a case file and that all documents are filed 4. Keep original copies of the court application

and file copies of them with the court. This will ensure that if the court losses the case file that all is not lost and the Magistrate has originals to work with.

5. Should you use an attorney to argue a restructuring case, make sure the attorney has appropriate experience in debt review matters.

An attorney with limited knowledge that does not have adequate knowledge of the debt counselling industry will most likely not argue the best case and will frustrate the Magistrate and will only lead to a delayed process with many successful oppositions by creditors Definitely Don’t!

1. Disrespect the Magistrate as this will have undesirable consequences in the future.

2. Make sure the hearing date allocated is on a Friday, as there have been cases where the wrong date was allocated and when the hearing date came along no debt review cases were being heard. This will cause extra expenses because creditors will need to be reserved with court document’(Notice of Motion) 3. Don’t solely rely on the court to keep case files, as they will from time to time get lost.

Keep a duplicate file 4. Don’t add pages or amend your application without having it stamped by the clerk and creditors notified if necessary. The Magistrates ‘all seeing eye’ will see this.

5. Don’t make any allegations in court you can not prove, as a case will be postponed so that you can supply proof of your allegation.

In summary, the Klerksdorp Magistrate Court is a court like any other with many do’s and don’ts. but should you abide by the do’s and don’ts, you will find the court to be fair and just, with more good aspect than bad.* Paul Nieuwoudt, paul@munnikdebtc.co.cc

INDUSTRY ADVERTORIAL

DEAR DEBT COUNSELORS Our debt counselling landscape has undergone a plethora of changes. We have experienced extreme and contradicting judgments and views with regards to Debt Counseling.

To name but a few: • A Code of Conduct by a conflicted and unrepresentative minority group of Debt Counsellors; • Backed by this group, changes to the procedures and rules with the Credit Providers embodied in so-called DRAC rules; • The so-called Rules engine; • A spurious and badly implemented moratorium on Home Loans • A spate of terminations; • The introduction of the Credit Protection Act and its impact on a regulated PDA sector; • Biased regulations changes in favour of payment distribution agencies proposed changes to regulations benefit of Debt counselor input; • Fee structure changes; • An increasing number of DCAS a disenchanted members; • Conflicting judgments coming out of our courts a result of an Act largely ambiguous and lending itself to different interpretations

from the broader group of debt counselors.

We are gravely concerned about “the formation of a DC/CP Forum, to investigate abandonment of the existing debt review and the way forward with the banks.” (Agenda of a DCASA NEC meeting, 2011) We are of opinion that all the decisions made at this forum lack representation as the group supposedly representing you lacked transparency and promoted its best interest to the exclusion of your and the customers’ were not communicated with debt counselors in general.

The increase in fees is yet another concern.

The fee structure was not communicated to all debt counselors. The increase as proposed will be to the detriment of the consumer and it will not benefit the debt counselor, acting in good faith.

A group of debt counselors have been meeting on a regular basis, and I am sure that you are aware of numerous correspondences from members of this group, expressing their concern about debt review in general.

What input as a statutory stakeholder have you had in the above? Were the above mentioned trends, rules, views, effects and judgments communicated to you? Did you contribute in any way, to influence any of these factors effecting your profession as a Debt Counselor?

A minority, unrepresentative and conflicted group has made binding decisions on your behalf, and accepted certain industry agreements without our consent. This privileged group has kept vital information

THE WAY FORWARD We need an open and transparent platform, where debt counselors feel free to express their views, and feel confident that the interest of the broader debt counseling fraternity is adhered to.

We need to prevent a privileged minority group of debt counselors, from making decisions on behalf of the larger group of debt counselors.

Therefore we invite you, as concerned and unrepresented debt counselor to register at the

debt counselor’s forum. Through this forum, debt counselors will be able to communicate, and keep one another up to date on all the issues in the market. This will allow for Debt Counselors to decide in a democratic manner, the future of a Debt Counseling Association, if the need therefore arise. The future of this forum depends on the voices of the debt counselors who never had the opportunity to make them heard.

At this point it is important to state that this forum will ensure transparency, democracy, equality, education and interest of debt counselors, while the interest of the consumer is always taken into consideration. Members of the Forum of Credit Management suggested that debt counselors form a group or organization, where debt counselors can meet with all the other stakeholders in the debt review market.

We would like to thank the FCM for the opportunity to develop, and grow in the safe environment afforded to us. The current Forum of Credit Management can be visited at the website: http://www.rebels.co.za/ index.php?p=fcm. This site is for people who are serious about Credit Risk and Revenue Management. The Federation of Credit Management (FCM) is not a controlling body, it is an organisation, comprised of a set of smaller organisations, companies and individuals, whom seek to bring attention to issues that are of importance to the Credit Industry. Each organisation that comprises the FCM maintains control over its own operations.

A group of small, large business, individuals,

regulators and the ombud of credit subscribed to the formation of the in order to lobby the government and authorities and other parties for laws and rulings and issues favourable and affecting the credit industry. This initiative is supported by the National Consumer Forum and industries related to the service industry to credit, risk and revenue management. The FCM delegates meet informally, normally over a breakfast, to discuss credit industry issues.

The opinions expressed at these meetings are not legal and binding, merely for delegates own consumption.

A number of meetings have taken place on topics such as: Prescription of debt, Debt Counseling, NCA interest calculations etc.

Delegates to the FCM meetings are by invitation only and Corporate Rebels facilitates the FCM meetings.

The latest to join the ranks of the FCM is a group of concerned Debt Counsellors. Due to all the happenings in the world of the Debt Counsellor some Debt Counsellors decided to get together with the Consumers, their clients, and tackle the challenges that face the Debt Counselling Industry. The first of their meetings under the banner of the FCM was held in May 2011 and various initiatives were launched. If you are a “concerned� Debt Counsellor and would like to receive more news on this FCM DEBT COUNSELLOR FORUM please register.

Once you have registered, you will receive all relevant information and communication.

Concerned Debt Counselors PS: We anticipate re-name this group with your input and suggestions.

INDUSTRY

CONSUMER

THE DEBT COUNSELLING ASSOCIATION OF SOUTH AFRICA

rules still are the cornerstones of the process followed today. Unfortunately not all CP’s decided to follow these workstream processes at the time.

No DC Fee existed. The NCR for some bizarre reason expected DC’s to do Debt Review for R50.00 and the appointed consultants had recommended a once off fee of R350. A Fee structure was subsequently proposed by DCASA of a more reasonable nature which was agreed upon by the NCR and implemented.

DCASA started monthly meetings and workshops to provide feedback and empower A BRIEF HISTORY the slowly increasing number of DC’s.

DCASA has been around for longer than you DC’s received training on the workstream might think. Here Debtfree brings you a brief agreements. DCASA visited and interacted look at some of the highlights of DCASA’s with most CP’s on a regular basis to discuss history in the industry. bottlenecks and improvements. PDA’s were introduced and problems were encountered in 2006 the early PDA days and many hours were spent The NCR held 2 workshops (Cape Town and by DCASA members to resolve these issues.

Pretoria) where the DC Process and proposed fees were presented by external consultants. 2008 The NCR encouraged attendees who weren’t The first University of Pretoria report was yet registered DC’s to commence with the compiled and DCASA assisted in the collating formation of an Association that would of information. This report was the basis for the participate in the Industry. formation of the Task Team in 2009.

On the 13th December 2006, the first meeting was held and a decision was made that an 2009 Association would be formed and it was named Many members of DCASA spent hundreds DCASA. of hours in the Task Team to negotiate voluntary enhancements. We now have a 2007 standard process, standard forms, significant When the first client applied for Debt restructuring concessions that will benefit Counselling in 2007, there was no agreed the consumers and DC’s. Included in the processes. DCASA was formally constituted Task Team agreement is the Affordability and the first task was to reach agreement on Assessment Guideline for DC’s. The finalisation the process and rules. After consultation with of this guideline was difficult mainly because Banks what came to be called the “workstream” CP’s always wanted more money. The end processes were finalised. These processes and result was a very responsible guideline (not

rules) for DC’s. DCASA submitted proposals to the Magistrate Rules Board and contributed in a small way to the amendment of the rules.

Fresh proposals were submitted in 2011 to request standardisation of Rule 55 debt review applications. DCASA was part of a team to indentify improvements to the NCR Debt Help system. The NCR must now implement and role out the system. They have been working on the site but there is no mention of when this might finally happen.

2010 DCASA members were involved in the Magistrate training in 2010 (and again in 2011) to try and get the legal process standardised in the Courts.

DCASA has submitted a dozen proposals, letters and presentations to the NCR and DTI to request a fee review. This process is ongoing and there has been some conflict in the industry especially since the NCR recently withdrew it’s help for lower income consumers.

DCASA arranged 2 DC Conferences at no additional cost to all DC’s.

DCASA published a Reckless Credit Booklet and made this available at no cost to members.

DCASA was involved in the NDMA (in its new role) and NCR roadshows after the completion of the Task Team Report. This was attended by well over 750 DC’s. The objective was to ensure that the correct message on the Task Team Guidelines was conveyed to all stakeholders.

2011 In 2011 the PDA fees were changed in a way that will later see harm to consumers. DCASA raised objections and concerns and this has resulted in PDASA preparing new proposals to DRAC. Due to some internal concerns

DCASA arranged an election in 2011 at both Provincial Branch and NEC level. All DC’s were invited to join DCASA and participate in the election process and to stand for elections at either Branch or NEC level. DCASA members elected to the NEC are made up of the 7 NEC members elected annually at AGM and 9 nominated Provincial Branch. Representatives each having an equal vote. to reduce concern about one large company calling the shots etc all NEC members are required to declare their interest and abstain from any decisions where a conflict of interest may occur.

DCASA set up a Complaints Resolution Process for members and non members alike. Good feedback has been reported by DCASA regarding comments received from consumers, NDMA, DC’s and Credit Ombud on the implementation of this process. The aim of this project is to resolve disputes and provide additional training to DC’s. So far so good.

DCASA introduced a Debt Counselling Newsletter for members. DCASA also distributes many Court Case judgments received and has written Practice Notes on important Court cases. (Example Section 129 and Sect 86(10).)

2011 has seen a lot of ruckus within DCASA, with some members quitting and various allegations flying. New associations have been (and look to be) formed. However no one can deny that DCASA has been a large presence in the industry throwing itself headlong into many important issues and has provided a loud voice for it’s members.

INDUSTRY

CONSUMER

THE DEBT COUNSELLING ASSOCIATION OF SOUTH AFRICA STATEMENT Recently DCASA released this statement: “...During the last 4 years dedicated DCASA members worked as a team extremely hard. Very little or no input was received from non DCASA members over the last 4 years. When comments on the proposed Code of Conduct was requested 24 DC’s replied. When comments were requested on the proposed DC fee increase, 87 replied. Comments were also requested on the Affordability Assessment and input was requested on the Reckless Credit booklet, with only one response. We can mention many more examples but the point is illustrated. The bottom line is that it is easy to be a spectator and to criticize the players on the field. The priority of DCASA

is to appoint an independent CEO on a full time basis to ensure that the interest of all our members are protected. As stated ... the aim of DCASA is to improve the Debt Counselling profession and DCASA will continue to do so for its 300 members... ...We can add to the list but the fact is that a significant amount of work was done by DCASA members to improve the Debt Review process. In many a case this required intense negotiations with CP’s and the NCR and in some cases a compromise solution was required. It is natural that DC’s outside this process will be able to criticize some of the agreements and/or solutions.”

SERVICE DIRECTORY DEBT COUNSELLING AA Debt Counselling Centre Anthea Johannes NCRDC531 Tel: +27 (0) 21 982 0522 Cell: +27 (0) 84 402 7032 Alan Watts NCRDC 962 NCR registered Debt Counsellor Tel: 084 4448439 Fax: 086 6501954 alan@active-debt-counselling.co.za www.active-debt-counselling.co.za Central SA Debt Counsellors 082 950 7806 Fax: 086 563 1621 Consumer Assist Andre Snyman Tel: 0861 628 628 Credit Matters 021 431 9100 info@creditmatters.co.za CS Debt Counselling Bernidene Smith NCRDC 764 057 352 4115/352 5000 Welkom - Free state Darran Manikam NCRDC704 debt@mailbox.co.za Debtbusters 0861 663 328 (NO DEBT) Debt Budget ph. 021 701 7744 Debt Solve Debt Counsellors Office: 033 397 0945

DebtSafe 0861 100 999

Debtonators 041 585 0276

Debt Rehab Colleen Van Wyk(BCom, LLB) Debt Counsellor NCRDC2619 Tel: 083 290 0848 Tel: 011 740 7374 Fax: 086 716 9694 Website: http://debtrehab.co.za

Fincorp debt Counsellors cc Cecilia Zwarts fincorpdc@yahoo.com

Debt Rescue Neil Roets NCR DC 474 Cell: 083 644 7406 Tel: 0861 800 009 Fax: 086 523 0617 E-mail: admin@debtrescue.co.za www.debtrescue.co.za Durban Debt Counselling Services Suite 112, 1st floor Union Club Building 353 Sm ith Street Durban, 4001 Tel: 031 301-7893 Fax: 031 301-5809 phumla.ngema@telkomsa.net Debt Counselling South Africa Cape Town Branch Tel: 021 919 66 94 Rod De Witt NCRDC831 Visit: www.debtcounsellingsa.co.za Debt Knowledge Debt Counselling 082 379 2337

Holistic Debt Counsellors info@holisticdc.co.za Helpdesk Debt Counsellors Allan Hoffman Tel: 0861 000 754 Help-U-Debt (Vaal Triangle) Wanine Tel: 082 445 3967 Help-U-Debt (Potchefstroom) Madra 083 390 3275 Help-U-Debt (Parys) Marilouise 082 920 6249 Help-U-Debt (Vanderbijlpark) Herma 083 320 8303 MG Consulting NCRDC 1403 Strand - Helderberg Area Telkom : 021 853 4537 Mobile Phone: 082 450 7459 / 082 782 0595 Fax Number: 0866 220 690 E-Mail: info@mgconsulting / cambouris.christina@gmail.com www.mgconsulting.co.za

NDA Debt Counsellors Your Trusted Debt Counsellors Gary Williams (NCRDC 143) Tel: 034 315 3880 Fax: 086 612 4112 gary@ndad.co.za www.ndad.co.za Think Green Debt Counselling Sandi Pauw sandipauw@mweb.co.za Tel : 012 991 6638 Cell : 082 460 7800 Fax : 086 219 2615 Incentive Debt Counselling “Paving the way to a Debt Free Tommorrow” Darran Manikam NCRDC704 Tel: (031) 409 9379 Fax: (031) 409 1327 Cell: 0845898286 Branches: Phoenix and Shallcross Indigo debt counsellors CC Tel: 087 808 9734 Fax: 086 580 8675 indigodc@iburst.co.za

DRS CRADOCK Herman Marais Cell: 082 378 3743 Fax 045 838 6572 Email cradock@drssa.co.za

DRS PORT ELIZABETH Office: 041 453 8961

DRS QUEENSTOWN Herman Marais Cell: 082 378 3743 Office: 045 838 9764 Email herman@drssa.co.za

DRS SOMMERSET EAST Luther De Bruyn Office: 042 243 1107

DRS MTHATHA Herman Marais Cell: 082 378 3743 Office: 047-5323356 Email herman@drssa.co.za

MANGAUNG Zune Coetzer Office: 051 436 4515 Email zune@drssa.co.za

EASTERN CAPE: DRS ALBANY Office: 041 365 5857 DRS ALGOA Craig Wheetman Cell: 083 299 0311 Office: 041 364 1888 Email david@drssa.co.za DRS BOND CHOICE P.E. Office: 041 393 7000

BORDER REGION: DRS EAST LONDON Office: 043 7212 656 DRS KING WILLIAMS TOWN Harry Light Cell: 082 573 5803 Office: 043 643 3024 Email: harry@drssa.co.za

DRS CENTRAL 041 586 2020 Email leon@lynxsa.com DRS DESPATCH Office: 041 933 1189 DRS HUMANSDORP Office: 042 291 0135 DRS KIRKWOOD EXPRESS Office: 087 8080 500

DRS SIDWELL EXPRESS Office: 041 451 0474

FREESTATE:

SOUTH FREESTATE Office: 053 591 0734 GARDEN ROUTE: DRS GEORGE Office: 044 874 2820 Email francoisv@drssa.co.za GAUTENG: DRS PRETORIA CENTRAL Ivan Mabuthu Cell: 082 266 6210 Office: 012 320 8304 Fax: 012 320 8388 drspretoriacentral@drssa.co.za DRS CENTURION EXPRESS Office: 012 653 0127 DRS HARTEBEESPOORT Office: 012 253 1231 DRS LIMPOPO CENTRAL Office: 015 297 1387

DRS PRETORIA NOORD Office: 012 546 2187 DRS ROODEPOORT EXPRESS Office: 011 472 4171 DRS RUSTENBURG 083 740 4620 DRS ZAMBESI EXPRESS Office: 012 7555 225 KWA ZULU NATAL: DRS MORNINGSIDE Ericah Mtshali Cell: 076 578 8660 Office: 031 301 5993 email ericah@drssa.co.za DRS DURBAN NORTH EXPRESS Office: 031 584 6305 DRS GREYVILLE Office: 031 309 8716 DRS KOKSTAD Office: 039 727 1430 DRS PHOENIX 082 374 7040 WESTERN CAPE: DRS BELLVILLE Office: 021 948 8523 / 4 DRS DIAMOND Office: 021 421 8563 DRS TYGERBERG Office: 021 945 4062 DRS WEST COAST Marius Coetzee Cell: 082 978 4407 Office: 022 713 3766 Email mariusc@drssa.co.za

Debt DRS SALDANHA Office: 022 714 3939 DRS SOLUTIONS 084 586 5600 Ramonti Debt Counselling Jacob Ramonti - NCR DC 932 Cell : 082 962 4537 Fax: 086 658 7627 Email:ditsamai@yahoo.co.uk Soweto U-Win Debt Counsellors Coreli Roos - NCR DC 509 Aliwal North, Burgersdorp, Bethulie, GariepDam, Smithfield, Springfontein Cell:079 626 66241 croos@global.co.za Rihanyo Debt Counselling (012) 804 50 57

SUPPORT SERVICES Staff Line Ndizani Executive Recruitment Cell no: 083 3028163 Direct Line: (011) 468 - 2150 E- Mail: saki@staffline.co.za Blank Design For all design and marketing needs including websites, brochures, business cards etc.

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FINANCIAL ABSA Customer Debt Repair Line 0860 356 356 Credit Ombudsman 0861 662837 Experian 011 799-3400 debtcounsel@experian.co.za Eric Streso Financial Planner B Juris LL B CFP MBA Tel: 0833273358 Fax: 086 612 7912 Fair Debt 0829019788 or 012-3772558 ray@fairdebt.co.za PACFIN Financial Solutions Head Office Tel: +27 11 9757445 Fax: 0865368783 36 Van Riebeeck road Kempton Park 1619 pieter@pacfin.co.za Monte Carlo Building No 8 Voortrekkerstreet Kempton Park 1619 Kempton Park Contact: Reyno Coetzee Tel: +27 11 3945363 Fax: 0866048002 Cell: +27 73 3690884 kemptonpark@pacfin.co.za Boksburg / Germiston Contact: Armand Posthumus Tel: +27 11 8921911 Fax: 0865620378

Nelspruit Contact: Ann Baker Tel: +27 13 7415559 Fax: 0880 1374 15559 Cell: +27 82 9024236 jeleroux@telkomsa.net Springs Contact: Wynand Mclachlan Tel: +27 11 8113728 Fax: +27 11 8113728 Cell: +27 83 2754014/5 wynmc@telkomsa.net Gooseberry Business Advisory Tel: 012 644 0589 Nedbank Debt Rehabilitation & Recoveries Services 0860 109 279 STD Bank Debt review Helpline Telephone: 0861 111 402 TransUnion 0861 482 482 Thinkmoney Financial comparison website Contact: Gareth Mountain Tel: 079 0996 798 www.thinkmoney.co.za WIZARD Vereeniging Making Mortgage Magic Wanine Smit Tel:+27 16 454 1132 Fax:+27 86 686 3678 Cell:+27 82 445 3967 www.wizard.za.com

FINANCIAL PLANNING Eric Streso Financial Planner B Juris LL B CFP MBA Tel: 0833273358 Fax: 086 612 7912

LEGAL Brett Carnegie Attorneys Tel: +27 (21) 4470332 Fax: +27 (21) 4470338 Mobile: +27 (0)82 320 6099 www.carnegielaw.co.za Suite 23(B) Unit 8 Waverley Business Park Mowbray 7700 Scheepers Attorneys Gerhard Scheepers schlaw@iburst.co.za LUCID Attorneys Tel: 011 880 1100 Fax: 011 880 1101 Email: info@lucidsa.com www.lucidliving.co.za/attorney Ludick Attorneys bev.ludickattorneys@gmail.com Prinsloo & Associates Attorneys and conveyancers Nanika Prinsloo Farm Bergamot, Paarl 7620 P O Box 6199, Paarl 7620 14 Laing Street, Barrydale 6750 Cell: 072-8558-106 Fax: 086-623-5986

nanika@vodamail.co.za www.empowerlaw.co.za RM Brown and Associates 601 Pier House, 13 -17 Heerengracht, Cape Town Docex 138 Cape Town t: 021 431 9127 f: 021 425 0875 e: lodea@rmbrown.co.za Agiliti CC Colleen Van Wyk(BCom, LLB) Tel: 083 290 0848 Tel: 011 740 7374 Fax: 086 716 9694 Website: http://agiliti.co.za

CREDIT BUREAUS Compuscan 0861 514 131 www.compuscan.co.za Computer Profile Bureau 0861 28 7328 www.c-p-b.co.za Experian www.experian.co.za Business- 0861 63 60 70 Consumer- 0861 10 5665 Micro Lenders Credit Bureau 0861 28 7328 www.mlcb.co.za TransUnion 0861 886 466 www.transunion.co.za

XDS 0860 937 000 www.xds.co.za

OTHER Association of Debt Recovery Agents: 011 781 3337 www.adraonline.co.za Banking Ombud 0860 800 900 www.obssa.co.za Credit Bureau Association 011 463 8211 www.cba.co.za Credit Providers Association 011 789 6825 www.cpa.org.za Department of Trade and Industry 0861 843 384 www.thedti.gov.za Financial Advisory and Intermediary Services Ombud 012 470 9080 www.faisombud.co.za

021 657 5000 www.ombud.co.za Micro Finance South Africa 012 345 0809 www.mfsa.net Motor Industry Ombud 012 841 2945 www.miosa.co.za National Credit Regulator 0860 627 627 www.ncr.org.za Ombud for Short term Insurance 011 726 8900 www.osti.co.za Pension Funds Adjudicator 021 674 0209 www.pfa.org.za South African Fraud Prevention 0860 101 248 www.safps.org.za The Banking Association 011 370 3500 www.banking.org.za SA FRAUD PROTECTION SERVICE (FREE SERVICE) www.safps.org.za 0860 101 248

Financial Services Board 012 428 8000 www.fsb.co.za Furniture Traders Association 011 789 6770 Legal Resources Centre 011 836 9831 www.lrc.org.za Long Term Insurance Ombud

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