CK Investments fined PLN 1.25 million for unfair investment practices

The President of the Office of Competition and Consumer Protection (UOKiK), Tomasz Chróstny, has imposed a penalty of nearly PLN 1.25 million on CK Investments for violating consumer protection laws. The Warsaw-based company, which promoted “investment bills” as a safe and reliable alternative to traditional financial products, was found to have misled consumers about the security and returns of their investments.

CK Investments, operating in the real estate sector, began offering its so-called “investment bills” in July 2019, advertising them as a straightforward and fast alternative to bank deposits, government bonds, or investment funds. The company claimed that these promissory notes provided guaranteed returns and secured capital. However, the UOKiK investigation revealed that these guarantees were unfounded.

“Our law does not recognize the term ‘investment bills.’ This was a term invented by entrepreneurs to describe a product that allowed them to raise capital, bypassing traditional methods such as bank loans or issuing financial instruments,” explained UOKiK President Tomasz Chróstny.

CK Investments assured investors of guaranteed financial benefits at the end of the investment period, but the investigation revealed that the funds raised through these bills were primarily used to finance the company’s operations.

“The promise of guaranteed returns likely influenced consumers to entrust their savings to CK Investments. In reality, there were no guarantees of profit or even reimbursement of funds. Without these misleading assurances, consumers might have chosen to manage their money differently,” said Chróstny.

The UOKiK decision mandates that, if finalized, CK Investments must notify affected consumers who purchased the investment bills between July 8, 2019, and January 1, 2023. Additionally, the company will be required to publish details of the penalty on its website.

The case against CK Investments is part of a broader UOKiK crackdown on companies offering misleading financial products under the guise of “investment bills.”

In April 2023, UOKiK issued a consumer warning about Assay Management Alternative Investment Company (Assay ASI), highlighting the risks of such practices. Subsequently, in February 2024, Assay ASI and its management faced penalties exceeding PLN 1.3 million for similar violations.

Other notable cases include:
• Aforti Holding, fined over PLN 790,000 in 2023.
• BREWE Leasing, fined PLN 150,000 in 2022.
• Yanok Mortgage Fund, fined nearly PLN 400,000 in 2021, a decision later upheld by the Court of Competition and Consumer Protection.

CK Investments retains the right to appeal UOKiK’s decision to the Court of Competition and Consumer Protection. However, if the decision is upheld, it will set a precedent for addressing misleading practices in the financial sector, reinforcing consumer protection in Poland.

This case underscores UOKiK’s commitment to combating deceptive financial practices and ensuring that consumers are not misled by false guarantees or unregulated investment schemes.

Source: UOKiK