In 2019, City Press received numerous complaints from readers about the behaviour of Lifestyle Legal, which was deducting money from their bank accounts for “legal services”. If payments were not made, Lifestyle Legal would threaten legal action and blacklisting. City Press raised these complaints with the National Credit Regulator, the National Consumer Commission and the Payments Association of SA.
Lifestyle Legal was the business behind 19 “loan finder” websites, which offered a service to source a loan for consumers. Consumers had to pay a monthly fee for services that, depending on the website, cost between R88 and R199 a month. Loans were not provided, but consumers found themselves on the hook for the monthly services.
If they tried to cancel, they were told they had agreed to a contract; and if they reversed the debit order, they were harassed and threatened with blacklisting.
Unfortunately, the wheels of justice turn slowly. However, the Stellenbosch University (SU) Law Clinic has successfully brought a class action application against Lifestyle Legal on behalf of thousands of defrauded consumers.
The SU Law Clinic filed the certification application with the Cape Town High Court on September 13 2019, and the ruling by that court was made this week.
In its application, the clinic stated that it “had been alerted to complaints from consumers concerning websites related to a company called Lifestyle Legal”.
“These websites apply dark pattern marketing methods to misleadingly appear to offer loans and/or free loan-finding services. Consumers who frequent these websites are induced to conclude ‘agreements’ for unwanted services and are shocked when they realise amounts are being deducted from their bank accounts.
“Consumers who are able to reverse these debits begin to receive a barrage of threats and harassment from the relevant company, which also threatens to blacklist or take legal action against consumers in the event that consumers do not make payment in terms of the agreements.”
The clinic argues that Lifestyle Legal’s behaviour is unfair under the Consumer Protection Act [CPA] and that “their demands for and/or collection of payment are unconscionable in terms of section 40 of the CPA, or alternatively unlawful under the common law”.
According to SU Law Clinic senior attorney Stephan van der Merwe, the class action will enable the clinic to request “restoration of moneys illegally debited and compensation for resulting losses on behalf of thousands of consumers who were affected by the respondents’ conduct”.
What do you do if you have been a victim of Lifestyle Legal?
Van der Merwe has confirmed that the Cape Town High Court has certified that the following consumers will automatically form part of the class action against Lifestyle Legal and their websites:
“All persons who have had any monies debited from their bank accounts and/or who have been harassed and threatened in connection with any demand for or collection of payment by any of the respondents at any time from May 20 2015 to date on the basis of their having concluded purported agreements with any of the respondents through any of the websites listed below:
“Should you wish to not be a member of the class action, you may opt out of it by notifying the class action attorneys of record, the Stellenbosch University Law Clinic, by no later than October 1.
“If you do not opt out of the class, you will form part thereof without the need to inform us accordingly. We would advise that you maintain your own records of your dealings with the relevant website and that you check in on our webpage and follow our social media on a regular basis for updates on the case.”