No grounds to suggest misleading conduct

Concerns about lending decisions,
Colleen’s business was placed in liquidation by the Inland Revenue Department, although she understood it was an interim measure so she could run the business for another six months to see if things came right. The landlord immediately cancelled the lease and took all the business assets under its general security agreement, which had priority over the bank’s general security agreement. The liquidation proceeded as usual.
November 2018

Colleen said the bank had misled her by representing that its agreement gave it priority over the assets of the business, and that no other creditor could take action against her. She also said the bank should not be seeking repayment of loans from her under her personal guarantee because all debts should have been covered by the bank’s general security agreement.

Our investigation

We were unable to uphold the complaint because of insufficient evidence of misleading conduct. Further, as Colleen had agreed to personally guarantee the company’s debts to the bank, we could not say that the bank should not be seeking repayment of those debts under the guarantee. 


We did recommend, however, that the bank pay compensation of $500 for its delay in responding to the complaint.

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