DRIVE AWAY from Mangere Town Centre in South Auckland into the streets fanning out from the suburban hub and it takes only 5 minutes to spot a mobile truck shop.

The trucks are large and their paint jobs in bright blocks of colours – yellow, red and navy – make them highly visible. The vehicles trawl the streets in low income areas, selling clothes, bedding, furniture and electronic goods and more recently food.

The companies running the trucks have been operating for many years in South Auckland and Porirua but have started in other centres including East Cape, Napier, Rotorua, Whangarei and Whakatane. The prices of the goods they sell are much higher than in shops.

Vai Harris, service manager at Vaiola P. I. Budgeting Service, pithily sums up the crucial reason for the vehicles’ success: cash is not required. The companies all offer credit, meaning people can obtain food immediately even if they don’t have ready money.

Ms Harris says the other attractions of the trucks are they don’t do credit checks and they come to people’s homes. Families may not have a car, or it may be unreliable, or there may be no money for petrol, making going to the shops difficult.

Payment trap

Both the companies and the customers focus on weekly repayments required when goods are bought, rather than on the total amount to be repaid. Purchasers may not be aware of how much they will pay altogether: their emphasis is on the fact they believe they can meet the $20 or $30 a week payments.

This explains why people sign agreements to pay inflated prices for items they could buy far more cheaply in shops. Ms Harris has seen contracts charging $20 for a can of corned beef, $35 for a packet of noodles and $66 for powdered milk.

A 2014 Lync (NZ) Co Ltd contract obtained by Nga Tangata Microfinance Trust budgeter Linda McCallum lists prices ranging from $23.99 for a packet of biscuits to $49.99 for 1 packet of rubbish bags (see “Overpriced”). A Shoppers Stop Lifestyle Ltd document records the prices of shoes as $100 and 3 pairs of socks at $30.

Mangere MP Su’a William Sio says there are cultural imperatives at play. “The biggest thing in most of our communities is the cultural aspect of not wanting to say no. It’s being hospitable to people who come up to the doorstep. As a result of that, these salespeople take advantage of that. It’s often worse when it’s somebody [the customer] knows because they feel an obligation and because there’s a sense I should trust this person because he is one of ours.”

Mr Sio says trucks selling food has a lot to do with poverty, inequality and families not having regular work hours. They might receive a week’s pay one week, but only a day’s pay the following week.

Ms Harris says prices charged for non-food items are also high. She had one Mangere client charged $990 for a 32-inch television when a 45-inch television could be bought in Manukau for $620. Another client bought 2 mobile phones for a total of $4500. When Ms Harris told her the items could be bought much more cheaply in a shop, the client replied she had no cash. A mother signed up to buy a bed for her daughter for $990, more than twice the price at a retailer. Ms Harris says that woman’s mortgage payment is the same amount as her income.

The documents often state the item won’t be delivered until after the purchaser has made 10 or 12 payments. Budgeters say sometimes items are never delivered. Free gifts promised may also fail to materialise. One of Ms Harris’ clients had paid $770 towards a TV but hadn’t received it. When Ms Harris spoke to the company, she was told the television was still on order.

Kevin Main of Budget Advisory Service (Whakatane) has recently dealt with cases in which the original documents have differed from the carbon copies. He says between $200 and $400 has been added to the debts owed for goods the customer didn’t purchase.

Mr Main’s budget service tries to cancel transactions and asks banks to place a note on accounts stating direct debits are not to be re-activated but he says banks are reluctant to do this.

Banking Ombudsman Deborah Battell says she’s been informed by Auckland-based budgeting services about companies getting people to sign multiple direct debits and has spoken to banks and officials about the problem. “The customer’s own bank will not know that multiple direct debits have been signed … it’s clear the public needs continued warnings about the practice.”

Industry compliance

The Commerce Commission says there are 40 companies operating mobile trucks.

Home Direct Ltd is the most established. It’s been operating since 1973 and has 150 staff and 72 trucks. Some companies are owner-operated businesses, operating under just-in-time principles so they only buy goods once a customer has committed to a purchase.

It’s not always clear what legal transaction the deal actually is. Some documents describe the transaction as a “rent to own agreement”. There is no such legal entity. Other transactions have characteristics of a layby sale, a consumer credit contract or a consumer lease but do not appear to fully comprise any one of these.

Consumer credit laws were tightened by the Credit Contracts and Consumer Finance Act 2003. The Act aimed to provide better protection to consumers after the Credit Contracts Act 1981 proved ineffective.

However, the 2003 law is also wanting and the government has had another go at reform. Part of the new law came into force in June last year and the rest – including a new responsible lending code – will take effect in June this year.

Recent law changes also introduced rules about door-to-door sales. However, the Commerce Commission’s opinion is these rules don’t apply if a mobile truck drives into a street and waits for people to come out to the truck, rather than the sales rep knocking on people’s doors. This is a significant loophole.

Commission investigation

The Commission began a 12-month project focusing on mobile trucks last year. Commission manager, competition, John Lyall, says the project aims to find out what’s happening in the mobile truck industry. A report is due in June.

Mr Lyall and senior investigator Jo Tilley say checks carried out during visits to traders indicate issues of non-compliance with the law. Some are minor but other traders are under investigation where breaches are likely to lead to enforcement action.

Ms Tilley says key issues are highly inflated prices and the quality is not what would be expected. It can also be difficult for consumers to find out total prices. She says the trucks target lower socio-economic areas. Companies get customers to complete multiple direct debit forms so if one is cancelled, another can be activated.

Other issues identified by the commission are high fees, ambiguous payment plans that do not include end dates and difficulties for purchasers in contacting the companies. The fee to get out of a $1300 deal can be as much as $600.

Ms Tilley says since the new laws took effect, the commission has been contacting mobile trucks to educate them about the provisions and check they’re complying.

Mobile trucks are also on the radar of some politicians. Commerce and Consumer Affairs Minister Paul Goldsmith visited the East Tamaki premises of a mobile truck company last December after hearing of widespread concerns about practices in the industry. A spokesperson for the minister says one of the problem areas in the money lending sector is irresponsible lenders offering loans to people who clearly cannot afford to repay. “That puts people and their families into impossible situations. The government is determined to crack down on unscrupulous lenders who take advantage of vulnerable borrowers and leave families in positions of incredible hardship.”

The spokesperson says it’s impossible to state with certainty whether all mobile trucks are compliant with the law, how many are not, or what breaches – if any – there are. He says the government has no plans to shut down mobile trucks. “It has, however, taken a number of actions recently to better regulate the activities of lenders, including door-to-door salespeople and mobile trucks.”

East Coast MP Anne Tolley says the issue is important to her as a local MP but believes it’s a problem for local government.

“[We] know of the long-term debt many of our vulnerable families on the East Coast incur as a result of mobile vendors. I believe local councils are best placed to deal with these trucks. I have written to the mayors in the Eastern Bay of Plenty part of my electorate and I am looking forward to working together on measures to curb the negative effects in the region, particularly in the suburban areas,” Ms Tolley says.

Exactly what role local councils could play to regulate these companies remains unclear.

Education efforts

Budgeters are divided on the efficacy of education about mobile trucks and financial literacy in preventing people from signing up to expensive deals.

Murupara Budget Advisory Service Trust manager Carolyn Meihana says educating the community is key. She advises clients to tell salespeople they need to speak to their budgeter before committing to buying. “Nine times out of 10, they leave then.”

She dealt with a case in which a small tablet computer was going to cost a total of $2500. When Ms Meihana queried the deal, the salesperson told her to beat it. “My client said ‘She’s my budgeter. You beat it.’ And she did.”

The service’s slogan is “Before you sign on the dotted line, think twice. Get budget advice”. Staff working in the centre have T-shirts with the slogan emblazoned on them.

However, Ms Harris and Mr Sua are less optimistic about the role of education. They say, as long as incomes are low and rents are high, desperate people will continue to sign up to expensive deals.

Consumer.org.nz says:

• Companies operating mobile shopping trucks are targeting some of the most vulnerable consumers.
• The Commerce Commission should take enforcement action against these companies where there’s a clear breach of the law.
• Door-to-door sales rules need to be strengthened so they cover trucks which drive into streets and wait for customers to come to them.

IS THE POLICE MISHANDLING of the investigation into alleged sexual offending against young women in Auckland a one-off failure or a nationwide problem ?

Right now, we don’t know the answer to that question. However, it is difficult to accept that the deficiencies are an isolated case.

Police Commissioner Mike Bush said on 19 March that the Independent Police Conduct Authority had “found no evidence of ongoing and widespread poor practice nationally.”

The IPCA in its Report on Police’s handling of the alleged offending by ‘Roastbusters’ said at paragraph 118 that –

“In the Authority’s view, most of the deficiencies identified in the Police investigations are a result of poor individual practices and cannot be said to be representative of Police child abuse investigations nationwide.”

It would be reassuring to be able to take that statement at face value, but it is hard to do so.

The ICPA did not actually investigate child abuse investigations nationwide. Its investigation was tightly focused on seven cases in Auckland. It is accordingly unclear on what evidence it bases the statement that there is no nationwide problem.

Indeed, the IPCA’s own May 2010 report Inquiry into Police Conduct, Practices, Policies and Procedures Relating to the Investigation of Child Abuse states quite the opposite. It found deficiencies in a number of policing districts around the country.  The IPCA made 34 recommendations to the police in 2010 to rectify these shortcomings. However, the IPCA’s March 2015 report states at paragraph 120 that –

“It is disturbing that several themes identified as a result of the Authority’s [2010] child abuse inquiry (such as deficiencies in investigative practices, file recording, collaboration with CYF, and case supervision) have, again, been highlighted in the Authority’s current investigation. This is notwithstanding the fact that the related recommendations made in 2010 to address the deficiencies were accepted and embedded by the Police.”

The only reasons we know about the widespread and catastrophic failings in the way the police dealt with the Auckland cases are because of the media publicity and the complaints made to the IPCA. Had it not been for those factors, we would not have learnt what had happened.

So how can we be sure that there are not other cases in which there has been no publicity and no IPCA complaints ?

The accumulated evidence over more than a decade appears to confirm that there are still ongoing concerns with the way police deal with sexual assault allegations. Dame Margaret Bazley was appointed in 2004 to the Commission of Inquiry into Police Conduct. She released her report in 2007, making 60 recommendations for change.

A 10-year monitoring programme was put in place to check police progress in implementing the recommendations. The Auditor-General has now released four reports as part of that monitoring. They have found that progress has been pretty patchy. The third report in October 2012 said that “significant leadership challenges still exist and most of the Commission’s recommendations are still to be completed.”  The Auditor-General herself in that third report described progress as “mixed.”

This is far from a ringing endorsement. The fourth monitoring report, released earlier this year, is more positive, but still identifies significant shortcomings. For example, that report makes further suggestions for improving police  workplace culture.

It is disappointing that the Auditor-General still feels the need to make such recommendations. Eleven years after Dame Margaret was appointed to the Commission, it might have been thought cultural issues would have been dealt with. 

Here are a few of the outstanding concerns following the release of the IPCA report –

1 The police should urgently review their policy of not prosecuting young people under section 134 of the Crimes Act for sexual connection with someone under 16 when the two young people are of the same or a similar age. The policy is understandable when young people are in a relationship and sex occurs with consent on an ongoing basis. However, that was plainly not the case here and it is shocking that the police did not realise this. The IPCA report states at paragraph 87 that this policy underpinned the approach taken by the officers. What that means is that police adherence to a general policy trumped understanding and application of the law and meant that young men escaped being prosecuted for sexual assault.

How widespread is the application of this policy and has it been used in other cases in other parts of the country to let young men escape prosecution for sexual offending ?

My concern about this is increased by the fact that the Operation Clover report also highlighted the ages of the parties as a reason for not prosecuting. The police would like us to accept that, while there were problems with the initial Roastbusters’ investigation, Operation Clover was thorough and remedied these early deficiencies. However, we cannot be confident about that. The 29 October 2014 media release accompanying the publication of the Operation Clover report states that a range of factors was taken into account in deciding not to prosecute. This included the age of the parties at the time.

The police need to explain exactly how the age of the parties was relevant to the Operation Clover decision not to prosecute. Did the police in Operation Clover also misapply their policy of not prosecuting teenagers over sexual activity ?

2 Lack of emphasis on prevention – When the police initially became aware of the young men’s behaviour, they passively monitored it for a lengthy period. This seems almost incomprehensible. Surely it was obvious that they should immediately have intervened to stop the behaviour and prevent more young women from being victimised ?

Actions the police could immediately have taken were to –

• Speak to and warn the young men
• Speak to and warn the young men’s parents
• Speak to the young women and their parents
• Speak to the school
• Publicise the activity to put a stop to it
• Refer the boys to Youth Aid
• Get the Facebook page taken down to stop the ongoing victimisation of the young women in cyberspace
• Charge the boys with attempting to pervert the course of justice in relation to the threats made to the girls to make them keep quiet about what had happened
• Use the provisions of the Children, Young Persons and Their Families Act 1989 to enable both the police and CYFS to intervene meaningfully and formally
• Get search warrants to obtain evidence
• Do a forensic computer search to recover online material which was deleted by the boys.

What made the police think that passive monitoring was an appropriate response and in what other police districts and what other situations do the police adopt such a response ?

3 The Child Protection Team which initially handled the complaints about the young men’s behaviour is a specialist police unit. Paragraph 43 of the IPCA report states that the CPT teams “are specialised units that focus almost exclusively on responding to, and investigating, reports of child abuse and neglect. They are made up of qualified detectives who have completed extensive and intensive CIB training in investigation practices/ approaches/methodology and the law, along with specialist training in the  investigation of child abuse (and, typically, adult sexual assault). The officers assigned to investigate, oversee and/or review the six ‘Roastbusters’ cases were qualified and experienced detectives. All of the officers had completed the child abuse investigators’ course, and most had worked in their respective CPTs for some time.”

Accordingly, one would expect that CPT team members would have a high level of training and experience in dealing with these issues. The public would think that a CPT investigation would be done to a higher level than an investigation into child abuse carried out by, for example, police officers in a smaller centre who are generalists and lack the expertise of the CPT. If the specially-trained CPT members did such a poor job and failed to investigate in even a rudimentary way, what is the standard of investigation of non-expert police officers in other parts of the country when they are called on to deal with such complaints ?

4 The police since the release of the IPCA report have continued to call for young women to “come forward.” Why are no members of the police, no community leaders and no politicians calling for the young men to come forward and own up to what they did ? Repeatedly asking the victims to come forward continues to make the victims responsible for the behaviour. It is the young men’s behaviour which needs to change, not the young women’s. Sexual violence against women is a male problem.

5 Lack of understanding of the law – the IPCA report at paragraphs 80 to 90 reveals widespread misunderstanding of the law by those conducting the initial investigation. This includes misunderstanding of sections 128A and 134.These sections deal with people who are too incapacitated to consent, and with the fact that sexual conduct with a person under 16 is an offence and that consent is not a relevant issue.

The lack of understanding of the law by the initial investigators is bad enough. However, the Operation Clover report at paragraph 7.5 states that “The principal ingredient at issue in all Op Clover cases is that of consent, including the ability of the girl involved to give consent due to the effects of alcohol consumption and/ or the male party’s reasonable belief as to whether there was consent.”

I have never believed that the principal issue was consent. Section 134 is very clear in its wording: sexual conduct with a person under 16 is an offence. The girls were as young as 13. The boys knew the ages of the girls.

The IPCA puts it plainly  –

“The reality is that a prosecution under section 134 says nothing about the presence or absence of consent, because it is simply irrelevant to the facts that need to be proved.”

Accordingly, the Operation Clover report’s emphasis on consent leaves a concern that the Operation Clover team also misunderstood and misapplied the law. The police need to urgently explain whether or not that is the case.

6 Police attitudes to sexual assault victims – The IPCA report appears to indicate that the police have more work to do. Paragraph 64 refers to the investigation report prepared by Officer D containing “a number of significant inaccuracies and assumptions.”

“It is unbalanced in its assessment of, and reference to, the evidence gathered (such as interview material and text data). For example, Officer D’s analysis of the young woman’s immediate response to the offending was tenuous and made unfounded assumptions regarding her “mindset” and motivations by placing significant weight on the text messages that were sent by others.”

Translation: the officer applied his own prejudices about sexual assault to his dealings with the young woman and minimised what had occurred. How often is this still occurring around New Zealand ?

7 Reliance on victim complaints and victim evidence – there is a concerning emphasis by the police on victims making complaints and being available to give evidence. The police need to explain why prosecutions could not be based on –

• evidence from other witnesses
• the posts by the young men on social media. Some of these were deleted. Did the police engage a forensic examiner to recover them ?
• the evidence of the girls who complained and completed interviews.

In one instance, three witnesses supported the young woman’s account. Two of those witnesses were collaborators of the young men.

Witnesses said that the young woman asked the young man to stop. He did not. When he was told by one of the other young men to stop and still did not, the two other young men physically intervened to stop the behaviour.

Why could no charges be laid ?

– You can read more of Catriona MacLennan’s work at: CatrionaMaclennan.co.nz