The President of the Office of Competition and Consumer Protection (UOKiK) has imposed a fine of over 7.2 million PLN on Lartiq (formerly Trigon). The company has violated consumer rights by including unreliable information in product presentations and other documents used to issue investment certificate.
Lartiq offered complex and very risky financial products – investment certificates issued to raise funds to purchase debt portfolios. However, it presented them to consumers as an instrument between a bank deposit and a classical investment fund. Product presentations indicated that the guarantee agreement constituted a “full security of capital”, with a minimum rate of return of 5-6% (depending on the fund). The guarantor of Lartiq (formerly Trigon) Profit XVIII-XXIV NSFIZ funds was GetBack (now under restructuring), whose financial problems became apparent in spring 2018 in connection with its corporate bonds. Lartiq – as can be seen from the company’s internal correspondence – was aware of those problems earlier, even before the issue of Lartiq fund certificates. Nevertheless, it did not inform consumers about the risk associated with the possibility of GetBack’s failure to meet its obligations in terms of fund asset management and guarantees granted. In presentations to clients, Lartiq used historical data for GetBack from 2013-2015.
“The investment certificates of Lartiq funds were purchased by consumers who had neither specialized knowledge nor experience in investing in complex financial products. Many of them simply wanted to put their savings in the right place, e.g. with a view to future retirement. Surveys conducted by UOKiK among more than one hundred purchasers of Lartiq certificates show that most of them were guided by such criteria as capital protection, certainty of investment, lack of risk, and security when making the decision on the investment. Misleading these people, hiding full information about the risk was unethical and absolutely unlawful,” says the President of UOKiK.
For practices violating collective consumer interests, the UOKiK’s President imposed a financial penalty on Lartiq in the total amount of over PLN 7.2 million (PLN 7,267,124). The company is also obliged to inform all consumers who purchased investment certificates of the aforementioned funds about the decision. They will also find out from the correspondence that they can demand from the entrepreneur to repair the damage, i.e. to cancel the contract with the obligation to reimburse the performance received and reimburse the costs related to the purchase of the product. The decision against Lartiq is not yet final and the company may lodge an appeal with the court.
