Toyota Financial Services and WesBank referred to the Competition Commission, accused of collusion

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  • Toyota Financial Services South Africa and WesBank have been charged with conspiracy over car loans
  • They were found to be engaged in a deal where they provide customers with car financing, splitting the market
  • The Competition Commission argues that the agreement does a disservice to customers, who should benefit from the options that arise from competition

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JOHANNESBURG – Toyota Financial Services (TFS) South Africa and WesBank have been accused of collusion over car loans. They were discovered to be engaged in a deal where they provide customers with car financing, thus splitting the market.

The case was referred to the Competition Commission, which found that WesBank and TFS SA had breached the Competition Act 89 of 1998, in particular section 4(1)(b)(ii).

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“FirstRand Bank Limited (FirstRand), through its WesBank and TFS division, is involved in the provision of vehicle finance services. So they are supposed to compete.

They have, however, entered into a shareholders’ agreement which contains clauses preventing them from competing,” the commission explained.

Toyota, WesBank, FirstRand, Competition Commission, Competition Law, collusion, cases, South Africa
Toyota Financial Services and WesBank are accused of colluding to provide customers with car financing. Image: Justin Sullivan/Getty Images
Source: Getty Images

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How TFS and Wesbank got along

According to My Broadbandthe agreement in question prevents WesBank from providing auto financing to people who buy Toyota vehicles from authorized dealerships, including Lexus and Hino models.

The Competition Commission argues that the agreement does a disservice to customers, who should benefit from the options that arise from competition. They added that companies that benefit from the deal will be fined 10% of their revenue, ENCA reports.

TFS has three shareholders who each hold a third of the company’s capital, namely Toyota Motor Finance (UK), FirstRand and TSA Investment Holdings.

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Reactions to the collusion scandal between TFS and WesBank

@OdirileSOUL believes:

“In China, executives would face a prison term.”

@Lali_villager remarked:

“Wesbank is a syndicate in its own right. 10% is absolutely nothing compared to the money they steal from customers on a monthly basis.”

@Mbuso_Wenkosi asked:

“So, are our cars automatically paid for? »

@kenna500000 said:

“We are cheated by the capitalists here. This collusion is a crime for our pockets.”

@Ms_Kefilwe shared:

“The capitalists catch fire.”

Steinhoff scandal: a settlement of 24 billion rand to be paid to shareholders

Speaking of business news, In brief News previously reported that the Western Cape High Court has finally made a decision in Steinhoff’s accounting scandal. As a result, the company must pay a settlement of R24 billion, which will be split among various shareholders.

After years of court appearances and legal disputes, this decision has been made, both in the Netherlands, where Steinhoff’s international holdings are based, and in South Africa.

The payment term was not clearly stipulated. However, the total amount of claims Steinhoff faces is R180 billion, meaning they currently only have to pay 13.3% of their total claims.

Source: News in Brief

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