The Aotea Finance group of companies has signed a settlement agreement with the Commission and will credit or refund current and former affected borrowers.

For the period to which the settlement applies, the Aotea Finance group comprised four separate companies operating across Auckland, with a common director and common shareholders, and a single general manager. The group has agreed to return $2,800,000 to borrowers in relation to 14,442 loan contracts, less about $107,000 already credited to 103 borrowers.

Aotea Finance accepts that between June 2015 and February 2016 its credit contracts did not include all the key information required to be disclosed to consumers under the Credit Contracts and Consumer Finance Act 2003 (CCCFA).

Those contracts failed to disclose required information such as:

  • the right to apply for changes to a loan agreement on the grounds of unforeseen hardship
  • an explanation of the extent to which a borrower would remain indebted if there was a shortfall on selling repossessed property
  • the companies’ registration numbers on the Financial Service Providers Register.

“Aotea Finance’s contracts did not contain the information required in the CCCFA including information about borrowers’ rights. Aotea Finance has updated its disclosure documents and given borrowers the right information, and has agreed to make some payments to affected borrowers,” said Commission Chair Anna Rawlings.

“Lenders must tell borrowers what they are getting into, how much it will cost them, and what options they have if they get into hardship. The law sets out all the key information that lenders must disclose, and borrowers need to understand that information when they take out a loan,” she said.

By mid-April 2020 Aotea Finance will provide, at its expense, a final review report prepared by an independent accountant approved by the Commission.

If borrowers cannot be found or do not contact Aotea Finance, amounts unpaid after 1 July 2022 will be paid to a charity agreed between the Commission and Aotea Finance.


There are now five companies in the Aotea Finance Group. Aotea Finance (Takanini) Limited began trading during the Commission’s investigation.

Disclosure is the key information about a loan that lenders must give to borrowers, such as the total amount to be repaid. It helps borrowers understand what the loan will cost them and what their and the lender’s obligations are under the loan.

The disclosure rules ensure the borrower gets the details of their loan, and a written record of the key terms of their contract, before they enter into it. The rules also help borrowers keep track of their debt throughout the terms of the loan.

The key information is fully described in Schedule 1 of the CCCFA.