Credit card companies are urged to lend a hand in minimising losses caused by modelling agency malpractices.
The Consumer Council has recently approached credit card companies in a move to protect the unwary from losing their money if they fall victim to modelling agencies engaged in malpractices and pay with credit cards.
Complaints against modelling agencies dealt with by the Council have revealed that a high proportion of cases involved payment by way of credit cards. Most victims were encouraged to pay by credit card so that as much money as possible could be obtained.
The payments made by the victims were made on the modelling agencies' promises of lucrative modelling jobs which invariably did not materialise. Since the promised modelling jobs were not provided, payments should be recoverable from the modelling agencies and there has been court ruling to that effect. There is therefore no reason why credit card companies should not stop payment when requested by the credit cardholders.
Complaints handled by the Council have shown various tactics used by modelling agencies to exact payment by credit cards.
In some cases, the victims were subjected to high pressure sales tactics and made to produce their credit cards while they were in the modelling agencies' offices, alone and without help. There was little they could do apart from handing over their credit cards. After leaving those offices, many have contacted their credit card companies to request that the payments be stopped. This was the first opportunity available to the victims to seek help.
In other cases, the modelling agencies misled the complainants into believing that the credit card voucher would be held as a surety against payment of commission due to the agency upon materialisation of the promised modelling job and would not be cashed in until the commission was payable.
Sometimes, the complainants were asked to make instalment payments by signing several credit card vouchers. They were assured that the vouchers would only be presented for payment in the subsequent months.
The complainants were therefore startled to find later that the agencies had in fact cashed all credit card vouchers at once. As a result, some complainants were plunged into deep financial hardship.
It is therefore entirely reasonable for the credit card companies to assist by stopping the payments.
Solely on complaints received by the Consumer Council, nearly $6,500,000 was exacted from the complainants in these credit card transactions between 1996 and the present, which is quite a considerable amount of money.
The breakdown showed that in 1996, a total of 189 complainants paid by credit cards that involved $1,382,700 while in this year, there was a sharp increase of 294 complainants involving $5,093,000.
The Consumer Council is now in discussion with the credit card industry for ways to protect and minimise the losses of victims of modelling agency malpractices.
It is hoped that credit card companies will agree with the Consumer Council on a set of procedures under which the companies will withhold payment to the modelling agency in question in the same way as cheques may be stopped.
Meanwhile, the Consumer Council confirms that the 2 modelling agencies recently raided by the police are the subject of 35 consumer complaints involving some $575,000. The Council has referred these cases to the police.
These agencies have adopted more or less the same modus operandi, as those agencies named by the Consumer Council previously, to entrap the complainants. The complainants were approached in the street by the agencies' representatives with the promise of modelling or advertising jobs and, once taken to their offices, persuaded to pay a host of charges such as membership fee, photo-taking fee, costume fee, training fee, management fee etc.
These agencies have gone one step further. They have successfully persuaded most complainants to part with their credit cards and their PINs to enable the agencies to make direct transfers immediately from the complainants' credit card accounts to the agencies' accounts.
The agencies in question were:
- Star Art Design (Holdings) Ltd.
Suite 1002, South Tower World Finance Centre
Harbour City
Canton Road
Tsimshatsui
Kowloon
Involving 34 complaints, between June 1996 and June 1997, totalling $564,180. - Classic Design (Holdings) Ltd.
Suite 906-7, Ocean Centre
Harbour City
Canton Road
Tsimshatsui
Kowloon
Involving 1 case totalling $10,000.
According to police investigation, the 2 agencies are operated by the same group of people.