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OFT takes credit licensing action against two West Midlands conservatory businesses

192/05    17 October 2005

The OFT has decided to revoke the consumer credit licence of Mr H S Khabra, trading as Town & Country Window Systems, and refused a licence application by a related business St James Financial Services Ltd. Both businesses operate in the West Midlands and manufacture and install conservatories.

The Adjudicator reached this decision because business associates of Mr H S Singh Khabra and St James Financial Services Limited had engaged in deceitful or oppressive business practices. For example, they did not:

• carry out work with reasonable care and skill
• complete work that had been paid for
• start work on time and keep appointments
• refund monies to customers where faulty work was not fixed or the contract was cancelled
• respond to customers' complaints or enquiries promptly or appropriately.

They also demanded consumers pay the full sum before the completion of work, when the contract stated payment due on completion of work; and continued to use a trading name used by other companies which had ceased trading, thus causing confusion for the consumer.

The Adjudicator also found that numerous County Court Judgments were outstanding against two business associates. In addition Mr H S Khabra was convicted of three offences under the Insolvency Act 1986 and disqualified from being a company director for a period of five years. Both St James Financial Services Ltd and a business associate were found to have withheld information from OFT when completing their respective applications forms, an offence under the Consumer Credit Act.

The Adjudicator therefore decided that both businesses are not fit to hold a consumer credit licence.

In considering fitness, the OFT will take into account a number of factors including:

• any offence or conviction of violence or dishonesty carried out by the business or anyone involved in running the business
• failure to comply with the provisions of the Consumer Credit Act or other consumer protection legislation
• consumer complaints and how they are dealt with
• evidence of unfair business practice
• evidence of discrimination on grounds of sex, colour, race or ethnic origin.

Christine Wade, Director of Consumer Regulation Enforcement, said:
'Business associates of Mr H S Khabra, have amassed a catalogue of complaints due to their deceitful and oppressive dealings with customers and provided us with false or misleading information when applying for two credit licences. In addition Mr H S Khabra is disqualified from acting as a company director. These matters call into question the suitability of both businesses to provide credit to consumers'.

NOTES

1. The Consumer Credit Act 1974 requires most businesses that offer goods or services on credit or lend money or are involved in activities relating to credit or hire to be licensed by the OFT.

2. The OFT can refuse or revoke a licence if it decides that a trader is not fit to hold one.

3. It should be noted that proceedings under the Act are not the same as those of a court and the adjudicator's findings are not the same as convictions by a court. Therefore where the adjudicator finds that an offence has been committed or a provision of the statute has been contravened, it does not mean that the person concerned has been convicted under court proceedings of that offence or of that contravention.

4. Adjudicators issue and determine licensing Notices under the Consumer Credit Act. They do so on behalf of the OFT, but make individual and independent decisions on fitness based upon the contentions in a Notice, the evidence attached to a Notice and the representations of those to whom the Notices are addressed. Representations may be made in writing and at an oral hearing.

5. An adverse determination (a refusal to grant a licence or the revocation of an existing licence) can be appealed to the Secretary of State for Trade and Industry. The period for any appeal has now lapsed.

6. The Consumer Credit Public Register is maintained by the OFT. The register documents traders that hold a licence and any action taken against them. It also details traders that have applied for a licence. Enquiries can be made to the Consumer Credit Licensing Bureau on 020 7211 8608.

7. The determination to revoke licence number 499397 was published on 26 August 2005. The licensee was Harkanwaljit Singh Khabra. The determination to refuse the licence application number 555720 was published on 26 August 2005. The application was made by St James Financial Services Ltd.

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