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Harmoney to plead guilty to having misled customers

By Ryan Weeks on 1st August 2016

New Zealand’s largest and best known marketplace lender is to plead guilty to charges filed by the Commerce Commission after promising pre-approval to over half a million customers. 


The Fair Trading Act (FTA) charges in the Auckland District Court against Harmoney allege that the platform sent pre-approval letters to over 500,000 New Zealanders. The letters were sent between October 2014 and April 2015. The 27 different versions of these letters each carried a similar message, suggesting that the recipient had automatically qualified for a Harmoney loan.


The letters advised these people to visit the Harmoney website in order to find out how much they been approved to borrow. In the event, however, those recipients were required to go through the standard loan application procedure in order to have their request listed on the platform.


The Commerce Commission website stated that Harmoney has cooperated with the investigation and that it intends to plead guilty to the charges.


Harmoney is by some way the largest marketplace lending outfit in the Antipodes. The company closed an $8.5m Series B round in February, which was led by UK-based investment trust P2P Global Investments. At that time the platform had facilitated more than $200m in loans. But Harmoney has run up against legal difficulty before. The company had its fee structure probed by the Commerce Commission in the summer of 2015, as was reported by That investigation is ongoing, and the Commission intends to provide an update “shortly”.


Harmoney has issued the following statement on the FTA charges: 


"The Commerce Commission has advised it has filed Fair Trading Act charges in the Auckland District Court alleging Harmoney misled consumers into believing they had been pre-approved for a personal loan."


"The recipients of the marketing material had been pre-selected through a credit screening process. Harmoney acknowledges that the information that qualified the offer wasn’t sufficiently prominent so as to be clear there was still a credit process to go through."


"Once Harmoney was made aware of the issue it took immediate action, stopping the campaign completely and ensuring a more robust process in the sign off of marketing campaigns."


"Harmoney has co-operated fully from first contact with the Commerce Commission."


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