Gauteng man in a legal battle with BMW Financial Services as he's forced to pay over R1.6 million for uncollected car

A Gauteng business man is in a financial nightmare as BMW Financial Services have taken him to court to demand R1.6 million over a luxury vehicle he never collected.

The turmoil began in late 2019 when Farhaad Mahomed, riding high on the success of his business, made a significant investment into a brand-new BMW X3M Competition destined to enhance his fleet.

The 50-year-old from Lenasia in Johannesburg, bought the brand new car in November 2019 from SMG BMW Century City in Cape Town. 

To secure the car, he stated that the dealership required him to sign an undated finance contract  even though the vehicle was still at the port of Durban.

Before the deal was completed, Mahomed said he paid a hefty R200,000 deposit and BMW Financial Services financed the balance of over R1 million.

Mahomed arranged for the vehicle to be delivered to his local BMW dealership, planning to pick it up in January 2020 so that it could be registered as a 2020 model. Little did he know, this decision would plunge him into a legal nightmare.

"If I had fetched it immediately in December, it would have been registered as a 2019 model and I would have driven it for just 30 days, for me it didn't make sense. So we agreed that I'll be fetching the car on January 2, 2020," he said.

As he was still waiting to collect the car, he noticed the car was advertised on various social media platforms after it was displayed in the dealership's showroom. He grew concerned that prospective clients might be test-driving it and asked for the advertisement to be taken down, but his request was not fulfilled.

"I was not happy because this means anyone who came to the dealership had access to the car and would have potentially test driven it if they were interested in it. This means the car was no longer new but a demo car and I was not going to accept it."

He provided IOL with an email sent to BMW, detailing his concern about the car being displayed in the showroom. In response, the sales manager explained that the car was in the showroom due to the basement parking being full.

The manager also stated that it was improbable for Mahomed to be the vehicle's first driver, as new vehicles are typically driven multiple times before reaching their owners.

"When the car is loaded onto a carrier at the plant, it is physically driven by a person. The same happens when the car is loaded onto a cargo vessel for the shipping of the car to South Africa.  Once the vessel arrives in our harbor, another person physically drives the car off the vessel to be loaded onto a carrier that will transport the car to Midrand," read the reply.

Still not satisfied with the response, Mahomed said he requested the footage to prove the car had not been driven while at the dealership, but he was informed that there were no cameras in the showroom and others were not working.

"That's when I knew they were playing me, they couldn't even provide me with proof that the car remained stationery from the day they got delivery," he said.

The straw that broke the camel's back was when Mohamed noticed that the car was missing the agreed-upon R12,000 carbon fibre trim.

"They couldn't explain why the carbon fibre trim was not there, and it should have been there because I paid for it. For me, that was it, the deal was off. So I sent an email requesting that they cancel everything because I will not be fetching the car, there was a lot of dishonesty on their part," he said.

Unbeknownst to Mahomed, the car deal had not been cancelled, and the vehicle was subsequently registered in his name, escalating his problems. At the end of the month, over R23,000 was debited from his Absa account, a move he described as fraudulent.

"I was shocked when they debited my personal account and I didn’t even have the car. I reversed each debit attempt, about five or six in total. I sent the money to my lawyer's trust account so that I could prove I had funds for the vehicle if we reached an agreement or the car was delivered to honour the instalment sale agreement," he explained.

According to Mahomed, when he applied for the car, he provided his business account where the instalments would have been debited. The Absa account was for personal use.

"Because I'm an existing customer, they already had my Absa account and I applied for the car using my Absa account. But when filling out the debit contract, I used my Nedbank business account," he said.

He provided IOL with a series of emails trying to stop the debits and terminate the contract but his efforts were futile.

Despite eventually removing his name as the vehicle's owner and multiple reversed debit attempts, BMW Financial Services issued Mahomed with a summons demanding over R1.6 million including interest.

In the summons, BMW Financial Services stated that Mohamed was contractually obligated to pay the money. This was because they had already paid the dealership when he agreed to the car's delivery in Sandton.

Mohamed, however, disputes this, asserting that the delivery and debit contract would only have been completed once he collected the car from the dealership.

"According to the Consumer Protection Act, a finance agreement without proof of insurance is reckless lending  but BMW said they had an undertaking from SMG Century City and I never ever provided as I never insured something I never had in my possession," he said.

"We put on record that you had no proof of insurance as my policy was not confirmed yet or supplied to the dealer, and you have no proxy letter authorising you to debit my business account  as this was only to be handed to the salesman on delivery and acceptance of the vehicle. Since these documents were not provided, I was not aware you would make payment to the dealership," he wrote in one of the emails.

Mahomed described the past five years as painful, stating that he lost most of his business and was blacklisted as a result of this battle.

"I have lost the prime years of my life as this started when I was 44 years old. BMW Financial Services' failure to hold their dealership accountable has led to my unjust prosecution for a car I never owned, causing significant damage to my life. Because of this, I don’t trust any dealer or salesman no matter how many times you deal with them, even the big ones," he said.

Mohamed also mentioned an ongoing criminal investigation, led by the Gauteng provincial head office commercial crimes unit, concerning the unauthorised debits.

"The salesman was charged for fraudulently signing OTP but turned state witness as bank fraud is the case."

When approached for comment, BMW declined to speak on the matter, stating that it remained sub judice.

"I have been advised by my responsible colleagues that this matter is sub judice. As such, I am unable to comment at this point," said BMW spokesperson, Hailey Philander.

According to court documents, the court date is set for September 2029.

sinenhlanhla.masilela@iol.co.za

IOL News

Get your news on the go, click here to join the IOL News WhatsApp channel.