A debt counsellor who misappropriated nearly R170 000 of consumers’ funds has been criminally charged with fraud and theft, deregistered and ordered to pay back the money with interest.
Former debt counsellor Zimkitha Zilo of Wynberg, Cape Town, created a fictitious credit provider linked to a bank account under her brother’s name. She then added this fictitious entity as a credit provider to which her clients’ monies were channeled. An amount of almost R170 000 was paid into this account before suspicions were raised regarding the apparent “credit provider”.
The National Consumer Tribunal ruled that Zilo had contravened the National Credit Act (NCA) and her conditions of registration.
The tribunal ordered Zilo to repay the money plus 15.5 percent interest a year to the PDA within 20 days and to send proof to the National Credit Regulator (NCR) within 45 days of the order being granted. Failing this, under the NCA, she may be liable for a fine or imprisonment for up to 10 years or both. The NCR has also opened a criminal case against Zilo for fraud and theft.
“The case, as far as we know, is still ongoing and we will also inform the police of the tribunal judgment,” Jan Augustyn, the NCR manager of investigations and enforcement, says.
Augustyn says the NCR regards this as a very serious abuse because consumers under debt review can lose their homes and most valuable assets if payments are not made according to their agreement with credit providers.
Since June 2007, when the NCA came into effect, four other debt counsellors have been deregistered – they are Barry Kotze, Sash Sahibdeen, Zolile Njokweni and Petrus Ferreira.
Another counsellor, Christopher Bornman, was deregistered last year but his deregistration has been suspended pending the outcome of an appeal lodged by him.