• The President of UOKiK ordered the company Obligacje Społeczne to remove from its websites content suggesting that its offer is related to bonds and to add information about the risks involved.
• This company's offer has nothing to do with bonds and consists in consumers giving it loans.
• The provisional decision issued is intended to prevent serious and intractable risks to the collective interests of consumers.

Tomasz Chróstny, President of the Office of Competition and Consumer Protection, issued the first provisional decision regarding the violation of collective consumer interests. It concerns Obligacje Społeczne Prosta Spółka Akcyjna, against which proceedings are pending and a consumer warning was issued at the end of January this year.

"I have accused Obligacje Społeczne of misleading consumers about its offer and failing to inform them of the risks involved, which in my view are high. The investigation found that there was a significant risk that consumers could lose large sums of money as a result of such actions. The provisional decision is intended to prevent this. In it, I ordered an immediate change in the presentation of the offer on the company's website so that it does not mislead consumers," says Tomasz Chróstny, President of UOKiK.

Allegations against the company

Obligacje Społeczne offers investments in the form of the consumers giving it a PLN 10,000 or PLN 100,000 loan. The interest rate depends, among other things, on the term of the contract and is expected to be between 6 and 12 percent per year. In presenting the offer on its website and Facebook page, the company used terms such as bonds, social bonds, Social Impact Bond, issue, issuer, series. The consumer could only find out when he/she was signing the contract that it was a simple loan which had nothing to do with securities.

"The practice can be particularly dangerous for consumers because the company refers to well-known and socially trusted concepts related to the financial market. Treasury bonds are associated with security, investing with a guaranteed return. Social impact bonds, in turn, are an innovative tool that makes it possible to finance public services through cooperation between a private investor and, for example, a local government. In this case, it is not that type of product either. However, the company uses these associations to induce consumers to give it loans," explains Tomasz Chróstny, President of UOKiK.

Another objection raised by the President of UOKiK concerns the omission of information regarding the risks associated with the offered investment. When presenting its offer, Obligacje Społeczne only highlights the benefits, for example by assuring consumers that: "In addition to a guaranteed profit, every transaction is secured". However, when the contract is signed, the loan given by the consumer is not secured in any way. Ultimately, the security is to be a 1/3 share in a car owned by a separate company – Prius 29. However, the consumer does not have the legal possibility to require the company to enter into a pledge agreement, and the company itself cannot be considered an entity that gives a guarantee of solvency.

The provisional decision

In the proceedings against Obligacje Społeczne, the President of UOKiK issued a provisional decision concerning consumer protection for the first time. It is a mechanism used in exceptional situations. It enables a swift response to practices that threaten the collective interests of consumers, if it becomes apparent that their effects may be serious and difficult or even impossible to remedy. In such a situation, under the provisional decision, the President of UOKiK may oblige an entrepreneur to cease certain activities. In the case of Obligacje Społeczne – the company must remove from its website and Facebook page content that may mislead consumers and induce them to make investment decisions without reliable and full knowledge about them.

The provisional decision is issued for a specified period, but no longer than until the issuance of the decision concluding the proceedings. The decision concerning Obligacje Społeczne is to be in force until, at the latest, 19 June 2022. The company may appeal against it, but that does not suspend the execution of the decision. The President of UOKiK may, by way of a decision, impose on the company a fine of the equivalent of up to EUR 10,000 for each day of delay in implementing the decision.

Consumer support:

Phone: 801 440 220 or 22 290 89 16 – consumer hotline
Email: [SCODE]cG9yYWR5QGRsYWtvbnN1bWVudG93LnBs[ECODE]
Consumer Ombudsmen – in your town or county
Financial Ombudsman – if the complaint is rejected by the financial institution

Additional information for the media:

UOKiK Press Office
Pl. Powstańców Warszawy 1, 00-950 Warszawa, Poland
Phone +48 695 902 088, +48 22 55 60 246
E-mail: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL