Fooled finance companies issue $ 20,000 in loans on behalf of retiree without her knowledge

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An Auckland woman has been the victim of identity theft. Photo / Sylvie Whinray

A widowed retiree was terrified of losing her home after three separate finance companies were tricked into issuing loans in her name totaling $ 20,000.

The oblivious 78-year-old only learned she was responsible for the fraudulent debts after one of the lenders filed a warning against her humble Auckland property and another threatened to repossess of his property.

Shocked and upset, the woman filed a statement with police suspecting that her grandson had used his driver’s license to successfully apply for the loans online through an elaborate identity trick.

And despite a written record of evidence which she said pointed to the likely culprit, just seven days later, police said they were closing the case because “we have not been able to find out who is responsible”.

Two of the companies have now confirmed in writing that the woman will not have to repay the money, but only after the Weekend Herald intervenes.

She said her plight revealed a gaping hole in online loan security procedures, and whether other innocent people were being victimized because of what she believed to be lax security and people’s greed.

“They didn’t do their job properly,” she said.

The woman felt that “money-grabbing places are just looking for money” and felt “they don’t care how they get it”.

The woman, justice of the peace, lives frugally in the suburbs of Auckland.

Heartland Bank says: "Unfortunately, this client is clearly the victim of elaborate fraud." Photo / File
Heartland Bank says: “Unfortunately, this customer is clearly the victim of elaborate fraud.” Photo / File

Earlier this year, she got a call from Heartland Bank welcoming her as a new customer.

She had never heard of the bank and was shocked to learn that she had issued a loan of $ 8,223 in her name in March.

A few weeks later a letter arrived in his Land Information New Zealand mailbox informing him that Oxford Finance Ltd had registered a warning against his house.

She later learned that the finance company had issued a $ 10,000 loan in her name in April, of which she was unaware.

Shortly thereafter, a letter arrived from Alternate Finance Ltd in Christchurch warning that an account in its name was “in arrears” with a balance owing of $ 1,767.73.

Failure to reimburse would result in “additional costs and risk repossessing your property”.

Suspecting her grandson, the woman launched her own investigation.

But she says two of the companies refused to provide her with copies of the loan application documents, and one didn’t even confirm how much she owed.

After extensive communications with Heartland Bank to prove she was not responsible for the $ 8,223 debt, she received a letter dated May 5 from Risk and Compliance Officer Annette Bryce confirming that the bank had been duped.

“You and Heartland Bank were victims of ‘identity theft’ by your grandson. [your grandson] not assumed your identity and fraudulently applied for this loan, we would not both be in this situation. “

The letter made no apologies, but defended Heartland’s processes, saying it was not uncommon for personal loans “to be fully processed online with no physical interaction between applicant and lender.”

The letter did not mention whether the debt would be canceled.

In a statement to the Weekend Herald, Heartland Bank declined to say what checks it wrote before issuing the loan.

He said: “Unfortunately this client is clearly the victim of elaborate fraud” and the bank was trying to prosecute the alleged violator.

And to the woman’s relief, the bank confirmed that it would not be held responsible for the debt.

“In this application, Heartland’s legal and responsible loan obligations were met, including through the use of biometrics.

Oxford Finance is owned by Turners Automotive.

Company CEO Todd Hunter has confirmed that the woman will not have to repay the $ 10,000 loan and that, following investigations by the Weekend Herald, the warning has been withdrawn.

Oxford Finance Ltd boss Todd Hunter says: "We agree that this is a fraud and that the matter is now in the hands of the New Zealand Police." Photo / Supplied
Oxford Finance Ltd boss Todd Hunter said: “We agree that this is a fraud and the matter is now under the control of New Zealand police.” Photo / Supplied

“We agree that this is a fraud and that the matter is now under the control of the New Zealand police.”

Hunter said the loan seeker provided the woman’s driver’s license and bank statements during the application process.

They also appeared to have forged the signature of a justice of the peace verifying the request and had taken a photo of the woman which was then provided for a “digital identity check”.

Fraud was a constant risk for the industry. While the company had security systems to protect customers, nothing was “foolproof,” Hunter said.

“There is not much we can do.

“We are as much a victim as she is. Someone stole $ 10,000 from us and it is very unlikely that we will get that money back.”

Hunter admitted the bank should have confirmed in writing that it would not sue the woman for the money, and withdrew the warning, before being approached by the Weekend Herald.

“It was a mistake on our part.

“Our intention was never to pursue her to the ends of the earth for this money.”

Oxford Finance had now filed a complaint with the police and forwarded all necessary documents to investigators.

Christchurch-based company Alternate Finance declined to confirm whether the woman would be held financially responsible.  Photos / Google
Christchurch-based company Alternate Finance declined to confirm whether the woman would be held financially responsible. Photos / Google

Alternative Finance declined to comment or confirm whether the woman remains financially responsible.

Waitematā East Acting Police Inspector Callum McNeill said police received a report of the fraudulent loans in May and conducted “a number of investigations”.

They had spoken to the woman, another justice of the peace was said to have witnessed the application documents, received documents from Oxford Finance and investigated the bank records.

As a result, investigators had identified “the individual likely to be involved”.

“The police have spoken with the complainant about the progress of the prosecution, but have expressed their wish to try to resolve this matter with the person they know.

“For this reason, the person known to the complainant was not formally contacted by the police.”

Although the case is inactive, legal action could be taken at the request of the woman or the finance companies, police said.

In a statement released this week, police confirmed that one of the lenders had filed a formal complaint and that the case had been “reactivated”.

The woman said her grandson had done wrong and would have to repay the money and face the consequences that ensued.

But she also criticized the three companies for allowing loan processing and failing to contact her directly to verify claims.

“It would never have gone this far if they hadn’t allowed this to happen.”

Massey University banking expert, associate professor Claire Matthews, says lenders should do the right thing and write off the debt.  Photo / Supplied
Massey University banking expert, associate professor Claire Matthews, says lenders should do the right thing and write off the debt. Photo / Supplied

Massey University associate professor Claire Matthews, banking expert, said lenders should do the right thing and write off the debt.

“They accept an element of risk. If that risk is realized, then they have to bear the consequences.”

Matthews was concerned that it took media intervention for the companies to make it clear that the woman was not financially responsible.

The fraud was “sophisticated” by avoiding the checks and balances in place.

She expected lenders to now look at their security settings to see what improvements could be made to prevent this from happening again.


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