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Fri, May 25 2012
Raiffesenbank Bulgaria fined 5.58M leva for misleading ads
Photo: Ivan Grigorov
Bulgaria's competition watchdog said on October 26 that it fined Raiffeisenbank Bulgaria 5.58 million leva for misleading advertising of loan terms.
The fine was imposed after a bank customer filed a complaint saying that a life insurance policy, which the bank offered free-of-charge with a mortgage loan and pledged to pay the expenses of, was cancelled early.
According to the complaint, the insurance policy was to last for the full duration of the mortgage loan, but was discontinued unilaterally by the bank in June 2006. Raiffeisenbank Bulgaria continued to offer the free life insurance policy for new customers until 2007, the Commission on Protection of Competition (CPC) said in a statement.
"The Commission believes that the offer of this extra service until almost the end of 2007 and the lack of explanation concerning the reasons that prompted the cancellation of the contract at the bank's request show the bank's intention to use the free-of-charge offer of insurance only as a means of attracting customers, without showing the intent to provide the service," the CPC said.
The CPC said that even in the case when it had difficulties paying the insurance policy, it should not have affected existing clients.
"Beyond the damage to consumers, this behaviour is against the interests of competitors on the financial services market, putting the bank in a privileged position vis-a-vis those that do not offer free insurance or those that do offer it and put aside the funds necessary to provide the service," the CPC said.
The watchdog said that it took into account the bank's co-operation in the matter and the fact that it reached a settlement with the plaintiff, but also the extensive period during which regulations were breached.
Raiffeisenbank said that it had not received the CPC's decision yet. "From the information published so far, it can be concluded that the commission took for granted circumstances that do not correctly reflect the facts in the case in question," the bank said in a statement, quoted by website investor.bg.
The bank said that it would appeal the decision if its initial conclusions were correct.
The fine was imposed after a bank customer filed a complaint saying that a life insurance policy, which the bank offered free-of-charge with a mortgage loan and pledged to pay the expenses of, was cancelled early.
According to the complaint, the insurance policy was to last for the full duration of the mortgage loan, but was discontinued unilaterally by the bank in June 2006. Raiffeisenbank Bulgaria continued to offer the free life insurance policy for new customers until 2007, the Commission on Protection of Competition (CPC) said in a statement.
"The Commission believes that the offer of this extra service until almost the end of 2007 and the lack of explanation concerning the reasons that prompted the cancellation of the contract at the bank's request show the bank's intention to use the free-of-charge offer of insurance only as a means of attracting customers, without showing the intent to provide the service," the CPC said.
The CPC said that even in the case when it had difficulties paying the insurance policy, it should not have affected existing clients.
"Beyond the damage to consumers, this behaviour is against the interests of competitors on the financial services market, putting the bank in a privileged position vis-a-vis those that do not offer free insurance or those that do offer it and put aside the funds necessary to provide the service," the CPC said.
The watchdog said that it took into account the bank's co-operation in the matter and the fact that it reached a settlement with the plaintiff, but also the extensive period during which regulations were breached.
Raiffeisenbank said that it had not received the CPC's decision yet. "From the information published so far, it can be concluded that the commission took for granted circumstances that do not correctly reflect the facts in the case in question," the bank said in a statement, quoted by website investor.bg.
The bank said that it would appeal the decision if its initial conclusions were correct.
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Appointments
Employment Agency
Kamelia Lozanova has been appointed the executive director of the Employment Agency, a position she has held ad interim since September 2011, following the resignation of her predecessor Rossitsa Stelianova. Prior to that, Lozanova was the agency's deputy executive director in charge of international projects and European programmes. She has been with the agency for more than 20 years. Lozanova has a degree in Slavonic philology from the St Kliment Ohridski University of Sofia.
Uniqa
Gloria Dimitrova has been appointed executive director and member of the managing board at Uniqa Life Insurance Bulgaria. Dimitrova began her career in 1998 at the insurance supervision directorate, but moved to the private sector and worked for professional services and insurance brokerage firm Marsh&McLennan and US insurer AIG, both in Bulgaria and the Middle East. She joined Uniqa as regional director for Sofia in 2010. Dimitrova has a degree in economics from the University for National and World Economy in Sofia and a master's degree in insurance from the Business Academy in Svishtov.
Beiersdorf
Bedros Kalfayan, general manager of skin care and cosmetics company Beiersdorf Bulgaria, will oversee the parent's company units in Romania and Moldova starting April 1. Following company restructuring, Beiersdorf's subsidiaries in the three countries were merged and are now one unit, part of Beiersdorf Central and Eastern Europe. Kalfayan joined Beiersdorf in 2007 as sales manager and was promoted to general manager in 2008. Prior to that, he worked for Axxon Bulgaria, Ferrero and Rubella. Kalfayan has a master's degree in industrial management from the Technical University in Sofia.
Kamenitza
Yassen Lyubenov is the new head of marketing at Bulgarian beer brewer Kamenitza. Lyubenov has 12 years of experience in marketing in the fast-moving consumer goods sector and has started his career as assistant brand manager at Kraft Foods Bulgaria. He later became brand manager at Wrigley Bulgaria, with responsibilities for Bulgaria and Macedonia. Prior to joining Kamenitza, he was senior marketing manager at Wrigley Russia, where he was in charge of brand expansion into Ukraine, Belarus, Central Asia and the Caucasus. Lyubenov has a bachelor's degree in international business administration from the University of Lincoln, UK.
Hewlett-Packard
Sasha Bezuhanova has been appointed Hewlett-Packard public sector director for emerging markets, where she will oversee HP public sector activities in 63 countries, including Bulgaria. Bezuhanova will also be in charge of HP's relations with the European Union. Bezuhanova has been HP's public sector director for Central and Eastern Europe since 2008; before that she was general manager of HP Bulgaria since 1998. Bezuhanova has a master's degree in electronics from the Technical University in Sofia and has completed a managment programme at INSEAD.
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There are dozens of misleading ads in the banking sector. Good, one has been caught and the rest of the bunch? At a rate of 5.5M leva per fine the total would amount to several hundreds of millions. Any public authority interested?