The Finnish Consumer Ombudsman is considering filing a class action against two credit plans provided by J.W.-Yhtiöt Oy and Euro24 Finance Oy that feature unreasonable credit costs. The initiation of a class action requires that an adequately large group of consumers opts in to the suit. To ensure this, the Consumer Ombudsman is seeking consumers who have participated in the credit plans in question and requests that they opt in to the class action.
The interest rate cap that entered into force on 1 September 2019 applies only to credit that has been granted after the new interest rate cap was approved. However, in recent years, instant credit companies have granted consumers a great number of instant credit plans that start at 2,000 euros, the costs of which are often unreasonably high. Consumers have also been provided with inadequate, contradictory and/or erroneous information concerning the credit costs of these credit plans. These grounds permit consumers to demand a reduction in their credit costs in such cases that do not fall within the scope of the latest interest rate cap.
To allow consumers to reduce the credit costs of expensive instant credit plans that were provided before 1 September 2019, the Consumer Ombudsman is considering filing class actions against the following credit plans:
- The Suomilimiitti 2,000-euro running account credit provided by J.W.-Yhtiöt Oy, granted between 4 July 2016 and 31 August 2019.
- The 2,000-euro running account credit provided by Euro24 Finance Oy, granted between 20 May 2016 and 20 May 2019.
Why and how should I opt in to a class action?
Filing a class action requires having an adequately large group of consumers opt in to the suit. Before the class action can be filed, the Consumer Ombudsman will seek out consumers who have participated in the aforementioned credit plans provided by J.W.-Yhtiöt and Euro24 Finance and request them to provide their preliminary opt-in to the class action. This preliminary opt-in process is vital, as it will allow the Consumer Ombudsman to assess whether a suitably large group of consumers will be involved in the suits. The process will also help ensure the functionality of the opt-in procedure.
Consumers can provide their preliminary opt-in by filling in a form on the website of the Finnish Competition and Consumer Authority. Consumers can also ask for more information at the number +358 29 505 3 053 Monday to Friday at 12.00–15.00.
Fill in the opt-in form, sign it and email it as an attachment to firstname.lastname@example.org. Use the subject “Preliminary opt-in for a class action”. You can also send it by post to Kilpailu- ja kuluttajavirasto PL 5, 00531 HELSINKI.
The preliminary opt-in must be submitted by 22 November 2019 at the latest. After the preliminary opt-in period has ended, all those who have submitted their preliminary opt-in will be provided with an information package that will contain more information on how the suit will proceed after the preliminary opt-in period. The Consumer Ombudsman will also provide further announcements on the progress of the class action.
What does a class action require?
The defendants of the class action will be the original creditors that provided the credit, i.e. J.W -Yhtiöt and Euro24 Finance. If a credit has been resold to a debt collection agency after its due date, the defendant will be the debt collection agency. In this case, the most likely agencies will be Weststar Oy for J.W.-Yhtiöt and Gothia Oy for Euro24 Finance.
First and foremost, the class actions would demand for the invalidation of the provisions concerning credit costs in the running account credit contracts, which would result in consumers only having to pay back the capital that they have withdrawn. If the provisions are not deemed invalid, the class action would demand that the consumers should not be obligated to pay more than 50% of the real annual interest in credit costs for any credit taken. Depending on the withdrawals and payments made, this would mean that consumers could reduce their credit costs by hundreds of euros.
If the Consumer Ombudsman is able to collect an adequately large group for the class action from the customer base of J.W.-Yhtiöt or Euro24 Finance or both, and if these companies will not voluntarily invalidate the related credit costs in their entirety, the suits will be filed in the District Court of Helsinki.
Why are these two credit plans being targeted in a class action?
A class action can focus only on the demands of such debtors whose credit plans have been granted by the same creditor and on similar terms. Unreasonably expensive credit plans have been provided by dozens of other companies than just J.W -Yhtiöt and Euro24 Finance. However, in the case of several of these companies, their credit terms have not always been the same for each consumer.
The class action cannot involve such credit plans granted by J.W.-Yhtiöt or Euro24 Finance that have been subjected to a debt collection action in a court of law or to matters pertaining credit plans that have already been decided in a court of law. This may have happened in such cases where J.W.-Yhtiöt and Euro24 Finance have sold their credits to a debt collection agency that have then proceeded to collect them using a debt collection action in a district court. In such cases, the Consumer Ombudsman may, at her discretion, assist debtors in any pending trials or provide them with assistance in their appeals against a judgment by default with an application for recovery procedure in a court of law. Consumers who have been taken to court by J.W.-Yhtiöt or Euro24 Finance for credit-related reasons can request for an extension of the district court response period (14 days) and submit a request for assistance to the Consumer Ombudsman through the opt-in form.
Consumers can also demand for the reduction of any unreasonable costs related to other credit plans that do not fall within the scope of the possible class action. Consumers can present this demand even if they have repaid their credit back on time, the credit is being recovered in a court of law, and often even when a consumer has been issued with a judgment by default for the demand for payment. More detailed instructions for such situations are available on the website of the Finnish Competition and Consumer Authority.