100 NZ Green Acres franchisees want Government help

In another New Zealand Herald article by Lincoln Tan (Victims of scam want Government help) the aggrieved former franchisees:

About 100 franchisees are seeking financial assistance to help them bring Green Acres to court – which is estimated to cost about $140,000 – after Commerce Minister Lianne Dalziel said at a meeting on Sunday that it had “declined all the demands for compensation” and claimed Keith Lapham was an independent business owner, and not one of its employees.

There was no immediate indication that aid would be forthcoming although the Minister meeting with the former franchisees is a good sign.

Ms Dalziel said the Serious Fraud Office, which is investigating the case, would be completing its investigations soon, and a decision on whether to press charges was about two weeks away.

These actions also involve a request to the lender to void their loan obligations:

Lawyers for the defrauded franchisees issued a letter of demand to Green Acres asking for the return of the money paid to Mr Lapham, and for loans for the purchases of the bogus businesses made through the company’s financing arm, FBL Finance, to be nullified.

Mr. Tyrone Pilacan, an immigrant from the Philippines, is quoted as saying he had recently lost his job and was struggling to meet the $800 monthly repayment to the bank.

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One Response to 100 NZ Green Acres franchisees want Government help

  1. Carol Cross says:

    Yes! It would be interesting if we could KNOW how many cheated and defrauded franchisees out in the world are still paying on their startup loans to avoid losing their collateral posted for the loan. So often, the collateral is the family home. The rising value of homes in the Western World did make franchise loans a lucrative product for the banks who most often didn’t even check out the franchisors because the collateral and the government guarantees were so good. In the US, the franchisors even worked to make retirement plans like 401’s available for investment in franchises.

    Thanks, Les Stewart, for trying to make this “world problem” visible to those out there who think that buying a franchise is the solution to a job and income, etc… .

    Those who continue to pay on their loans don’t show up on government default lists of the SBA in the USA or on the bankers’ default lists if the loan payment is made every month.

    Hopefully, governments are going to have to take a look at the dark side of franchising.

    Carol

    Like

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