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Debt collectors should stick to guidelines: G -

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Debt collectors should stick to guidelines: Gerry Harvey

The World Today - Friday, 23 May , 2008 12:13:00

Reporter: Brigid Glanville

ELEANOR HALL: Australia's largest furniture and electrical retailer Harvey Norman says it doesn't
support the finance company GE Money's practice of harassing its customers while collecting debts.

The Australian Securities and Investments Commission has ordered GE to pay compensation to some of
it customers because of the way it conducted its debt collection process.

But while it is distancing itself from the process of debt collection, Harvey Norman does use GE
finance to fund its two year interest free offers, and its CEO Gerry Harvey told Brigid Glanville
that the extended finance option is extremely popular.

GERRY HARVEY: If debt collectors' behaviour is really bad, that's not good and that shouldn't
happen. And if there are guidelines then they should stick to the guidelines.

BRIGID GLANVILLE: ASIC is saying in some of the allegations, some customers have been called more
than 1,000 times a month or 10 times a day. The guidelines say three times a week.

Do you condone this sort of behaviour by GE Money to get the money back?

GERRY HARVEY: Well I don't know how you would ring someone 1,000 times. You'd only ring them 1,000
times if they didn't answer the phone or something. That sounds quite strange.

I mean, if you ring someone and they answer the phone you would talk to them. If they didn't answer
the phone is that a ring? I don't know. I really don't know enough about it.

BRIGID GLANVILLE: Do you think these debt collectors though, should be allowed to go in and do
everything they can to get the money back?

GERRY HARVEY: No, not everything you can. That means breaking someone's leg, I guess, or shooting
them.

But no, they should stick to the guidelines and in the event that they can't get the money back
within the guidelines then I guess the money just has to be written off.

BRIGID GLANVILLE: Would you consider using another finance company?

GERRY HARVEY: Well there's not a lot of choice out there. We've got our own finance company which
we use a little bit.

But basically GE have been, you know, they've been exceptionally good with all the retailers out
there. They're very, you know, competent big time lenders. These are some of the biggest people and
best people in the world.

BRIGID GLANVILLE: Is this the sort of thing that you would ... concern you enough that you would
speak to GE about it?

GERRY HARVEY: Oh yeah, GE have been in contact with us. You know they're very concerned about it.

I've got a letter in front of me here from GE, saying they're more and concerned about it and
they're going to comply with all the guidelines.

BRIGID GLANVILLE: Are you worried that customers may turn away because of this, if they're worried
about using GE Finance, getting into a situation and getting harassed by a debt collector if they
need a bit more time to pay it off?

GERRY HARVEY: Well GE, in the conversation we had yesterday with them, we got half a million credit
cards out there and more than half a million customers, a lot more than that that have used our
interest free.

And I was told there were 12 complaints. So if there were 12 complaints out of half a million,
that's you know, not very much.

I'm not saying there's anything ... you know, those people were treated badly or not, I don't know.
But most of the people that deal with us in GE are very, very happy. And when I say most, I assume
it's 99.9 per cent.

BRIGID GLANVILLE: Are customers fully aware of the conditions they embark upon when they get a loan
through GE finance, i.e. that it's interest free for two years but then there may be a huge
interest of 20 per cent?

GERRY HARVEY: Some people are and some people are probably not. But it is explained to them, and it
is in the paperwork. But some people just don't listen I guess, when they sign, or they don't read.

But most people are aware, because you just, if someone gets two years interest free on no deposit
and then they don't pay or they pay late, your commonsense would say to you there was some penalty
for this. You couldn't say, "Oh I didn't know there was a penalty".

I mean, that's just unreasonable. You would have to know.

ELEANOR HALL: That's Gerry Harvey, the CEO of Harvey Norman, speaking to Brigid Glanville.