1
00:00:00,160 --> 00:00:02,920
Speaker 1: News Talk ZB. It is six seventeen. The government we're

2
00:00:02,920 --> 00:00:05,720
Speaker 1: going back to parliament weirdly now and apparently the fire

3
00:00:05,720 --> 00:00:08,280
Speaker 1: alarm is over, but there's a party happening somewhere. The

4
00:00:08,320 --> 00:00:10,959
Speaker 1: government is making a change to our consumer finance laws.

5
00:00:11,200 --> 00:00:14,600
Speaker 1: This is interesting because it could actually affect a class

6
00:00:14,640 --> 00:00:18,840
Speaker 1: action lawsuit. It could quash a huge class action lawsuit

7
00:00:18,880 --> 00:00:21,720
Speaker 1: against a n z an ASB bank. Jenetip Training is

8
00:00:21,760 --> 00:00:24,960
Speaker 1: The Herald's Wellington Business editor with us. Hey, Jana, Hey, Ryan,

9
00:00:25,040 --> 00:00:26,680
Speaker 1: how's that? Are you near that party? Is that what

10
00:00:26,720 --> 00:00:27,760
Speaker 1: I can hear in the background.

11
00:00:28,080 --> 00:00:31,120
Speaker 2: I'm near the party, but I'm unfortunately not at the party.

12
00:00:32,479 --> 00:00:34,720
Speaker 2: So if anyone hears any noise, I'm not at the party.

13
00:00:35,040 --> 00:00:39,120
Speaker 2: I'm talking about consumer finance law instead, which is obviously

14
00:00:39,200 --> 00:00:39,640
Speaker 2: much better.

15
00:00:39,760 --> 00:00:43,760
Speaker 1: No wonder you're not at the party exactly. Hey, remind

16
00:00:43,800 --> 00:00:46,159
Speaker 1: us what this lawsuit is. What's the crux of it?

17
00:00:46,920 --> 00:00:51,080
Speaker 2: Okay, So basically, under the current law, if your bank

18
00:00:51,200 --> 00:00:54,120
Speaker 2: or other lender gives you a loan but gives you

19
00:00:54,160 --> 00:00:58,320
Speaker 2: the wrong information about that loan, the default position is

20
00:00:58,360 --> 00:01:01,400
Speaker 2: you can get them to remby ursue all your interest

21
00:01:01,440 --> 00:01:05,000
Speaker 2: costs and other costs that you've paid for the time

22
00:01:05,080 --> 00:01:07,480
Speaker 2: that they gave you the wrong information. So that's like

23
00:01:07,520 --> 00:01:11,080
Speaker 2: if you go and use a mortgage calculator and it

24
00:01:11,160 --> 00:01:13,280
Speaker 2: spouts out one number, but they actually charge you another

25
00:01:13,360 --> 00:01:17,840
Speaker 2: number in another figure. You know that that is a

26
00:01:17,880 --> 00:01:21,720
Speaker 2: bad thing by the lender. And currently the default position

27
00:01:21,800 --> 00:01:23,760
Speaker 2: is that you can get all your interests in other

28
00:01:23,840 --> 00:01:27,520
Speaker 2: costs reimbursed. So there's currently a class action before the

29
00:01:27,560 --> 00:01:30,920
Speaker 2: courts because more than one hundred and fifty thousand people

30
00:01:31,840 --> 00:01:34,520
Speaker 2: have received the wrong information from A and Z and

31
00:01:34,640 --> 00:01:38,360
Speaker 2: ASB in the past, and this class action is trying

32
00:01:38,400 --> 00:01:41,679
Speaker 2: to get interest costs reimbursed for all these people. So

33
00:01:42,000 --> 00:01:45,280
Speaker 2: it could be hundreds of millions of dollars, possibly even

34
00:01:45,680 --> 00:01:49,760
Speaker 2: billions of dollars that these two banks have to repay

35
00:01:49,800 --> 00:01:53,640
Speaker 2: their customers. So that case is currently going through the courts,

36
00:01:54,280 --> 00:01:57,080
Speaker 2: but the government is looking to change the law in

37
00:01:57,120 --> 00:01:59,800
Speaker 2: such a way that that court case will be a

38
00:01:59,840 --> 00:02:04,080
Speaker 2: fe It's worried that the law is too heavy handed

39
00:02:04,640 --> 00:02:08,160
Speaker 2: and that the penalty that these banks face is disproportionate

40
00:02:08,240 --> 00:02:09,760
Speaker 2: to the mistake that they made.

41
00:02:10,480 --> 00:02:12,840
Speaker 1: That's a pretty unusual call for a government to make,

42
00:02:12,960 --> 00:02:16,680
Speaker 1: isn't it. I mean, this is a private business. They've

43
00:02:16,840 --> 00:02:19,200
Speaker 1: made a mistake, well, potentially made a mistake. Obviously the

44
00:02:19,240 --> 00:02:21,600
Speaker 1: courts will decide that, but why would the government want

45
00:02:21,639 --> 00:02:22,280
Speaker 1: to get involved?

46
00:02:23,360 --> 00:02:26,400
Speaker 2: Yeah, So, look, I think the government is worried that

47
00:02:27,040 --> 00:02:32,799
Speaker 2: if the penalty is disproportionate, that will make lenders to

48
00:02:33,080 --> 00:02:36,840
Speaker 2: risk averse and also add to their costs, Like if

49
00:02:36,880 --> 00:02:39,680
Speaker 2: these banks have to pay you know, hundreds of millions

50
00:02:39,720 --> 00:02:42,360
Speaker 2: of dollars we end up paying, that they end up

51
00:02:42,360 --> 00:02:46,560
Speaker 2: passing those costs onto their customers. The government's also worried

52
00:02:46,560 --> 00:02:48,960
Speaker 2: that if a small lender, like a little finance company

53
00:02:49,120 --> 00:02:52,000
Speaker 2: was hit by this, it could really cripple them and

54
00:02:52,040 --> 00:02:54,760
Speaker 2: make it harder for them to compete with the big banks.

55
00:02:55,240 --> 00:02:58,560
Speaker 2: So basically, the one hundred and fifty thousand bank customers,

56
00:02:58,560 --> 00:03:02,240
Speaker 2: they've already received some redress for the mistakes that the

57
00:03:02,240 --> 00:03:05,440
Speaker 2: bank's made, But the issue that's kind of been debated

58
00:03:05,480 --> 00:03:08,519
Speaker 2: now is, you know, whether they deserve to be compensated

59
00:03:08,720 --> 00:03:13,320
Speaker 2: more for those breaches. So it is a pretty unusual

60
00:03:13,360 --> 00:03:16,440
Speaker 2: situation for the government to change the law and make

61
00:03:16,480 --> 00:03:19,520
Speaker 2: it apply to something in the past, and not only that,

62
00:03:19,560 --> 00:03:21,880
Speaker 2: but make it apply to something that is actually before

63
00:03:21,919 --> 00:03:22,600
Speaker 2: the courts.

64
00:03:22,880 --> 00:03:25,200
Speaker 1: Yeah, really interesting move, jenat Thanks for walking us through

65
00:03:25,240 --> 00:03:28,080
Speaker 1: that appreciate it. Jenative Training in zid Herald's Wellington Business

66
00:03:28,240 --> 00:03:31,799
Speaker 1: Editor Outside a party at Parliament and Wellington. For more

67
00:03:31,880 --> 00:03:35,200
Speaker 1: from Heather Duplessy Allen Drive, Listen live to news Talks

68
00:03:35,240 --> 00:03:38,400
Speaker 1: it'd be from four pm weekdays, or follow the podcast

69
00:03:38,520 --> 00:03:39,520
Speaker 1: on iHeartRadio