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The JD Group responds


In the last two months Carte Blanche has brought you two exposés on furniture giant, the JD Group.

Our first story showed how the JD Group of stores offered the more expensive furniture loan rather than the cheaper HP agreements to their customers.

[Carte Blanche March 2007]
Herman le Roux (National Consumer Watch): 'In my opinion this is the greatest scam in the retailing industry in South Africa's history.'

Customers alleged they were given no option but to take the more expensive loan and in, all but one store, our hidden cameras verified this.

Journalist: 'So you don't do HP accounts?'

Russell's Manager: 'No sir, we don't do HP accounts.'

Linda Ellerston, one of their Pretoria clients approached the High Court on the legality of this practice, and to date the court has yet to make a ruling.

Many customers confirmed that they too had been given no choice. Some even went back to their stores to demand their contracts be converted to HP agreements.

Carte Blanche continued investigating and our second exposé revealed further questionable operational tactics. We discovered examples of reckless lending.

[Carte Blanche May 2007]
Her expenses every month are R5 290 leaving her with just R861 - well short of the required R2 490 monthly instalment. Clearly she couldn't afford it. Her stop orders bounced and Russells is threatening to repossess her goods.

And when these overburdened clients inevitably defaulted some were served with a double garnishee order, which is illegal

Pieter Jordaan (Professional Business School): 'But if there is a lot of these and this is the trend within their company, then this needs to be investigated in a little more detail.'

Customers with garnishee orders against them had to foot the bill for a 25 percent legal fee over and above the standard 10 percent that the court orders.

[Carte Blanche May 2007]
Ray Williams (FairDebt): 'I had opinions from six different attorneys and two magistrates and they all came back with the same comment: that it is illegal and that they cannot believe that these people ever got away with it in the past.'



But there was more. When some of the squeezed clients, who finally achieved a credit balance, were not informed and according to JD's own standing instructions the excess was 'written off'.

Despite repeated request for comments from the JD group before we went to air, they always refused. But this week, after the second exposé, Executive Chairman David Sussman cut short a trip to London to respond:

David Sussman (JD Group: Executive Chairman): 'I started this business with one store 24 years ago based on one fundamental principle and that is dealing with the consumer with absolute integrity and providing them with the best possible service. We stand by it to this very day.'

And he assured Carte Blanche that the problems we raised in our programmes would be addressed.

David: 'The impression has been created that so much has gone wrong. In my opinion we have problems, we are addressing those problems. Every single issue is being addressed and investigated. We are not stopping there ... we are going much further. External auditors are assisting us in investigating every single account that has attracted charges due to late payment. Now I have given Carte Blanche the undertaking that once that judgment is made I will come back to Carte Blanche and tell them exactly what the reality is. If we have made errors we will right those errors. We do not prescribe to taking what does not belong to us.'


IMPORTANT DISCLAIMER:
While every attempt has been made to ensure this transcript or summary is accurate, Carte Blanche or its agents cannot be held liable for any claims arising out of inaccuracies caused by human error or electronic fault. This transcript was typed from a transcription recording unit and not from an original script, so due to the possibility of mishearing and the difficulty, in some cases, of identifying individual speakers, errors cannot be ruled out.
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