The owner of mobile reseller Flexi Buy Limited has been sentenced to two years imprisonment by Auckland District Court, after taking money from customers without intending to supply goods as promised.
Convicted under the Crimes Act 1961 as a party to Flexi Buy’s conduct, Vikram Mehta was the sole shareholder and director of the company during the period of its offending.
Following a spate of dodgy mobile traders working across the North Island, Mehta’s conviction is the first jail sentence handed down in a prosecution initiated by the Commerce Commission.
“The Commission has successfully pursued a number of cases against mobile traders, but this was a particularly serious one, and that’s why we took Crimes Act action against Mr Mehta personally,” Commissioner Anna Rawlings said.
“The Crimes Act charges are consistent with other cases we have pursued where traders have failed to supply goods or services that their customers have paid for.
“All traders need to know that the Commission can and will take this action where it’s justified.”
As reported by Reseller News, Flexi Buy sold household and electronic goods door-to-door around the North Island between late 2012 and early 2014, but stopped trading after the Commission commenced its investigation.
In September 2015, the Commission filed charges nagainst Mehta as a party to Flexi Buy’s conduct for obtaining money from customers by deception and accepting payment from customers without intending to supply the goods they contracted to purchase.
Mehta was found guilty of these charges in November 2016.
Furthermore, in February 2016, the company Flexi Buy was fined $50,000 in the Auckland District Court for breaching the Credit Contracts and Consumer Finance Act 2003 by failing to provide its customers with adequate disclosure of key information about their credit contracts.
A further $3,408 was awarded in damages to affected customers.
Between late 2012 and early 2014, the company entered into over 300 consumer credit contracts, but only nine customers received their goods.
Instead, Mehta used Flexi Buy income for his personal use, rent on his Auckland apartment, and living expenses, including at least $22,000 spent during a 2013 trip to India.
In sentencing Mehta, Judge Cunningham said that “because of the seriousness of what occurred here, I am not minded to impose home detention”.
“In my view it needs to be a sentence at the top of the hierarchy of sentences to send a message to Mr Mehta and any other persons who seek to, in my words, rip off vulnerable people, that such behaviour that breaches the criminal law will be met with the full force of the criminal law,” Judge Cunningham added.
Mehta has indicated that he intends to appeal.
“The sentence sends a strong message that there can be serious consequences for traders who take customers’ money without delivering the promised goods,” Rawlings added.