AFG takes on News Ltd after 'extreme disappointment'

by Mackenzie McCarty29 Nov 2012

AFG’s general manager, sales and operations, Mark Hewitt, has issued a formal complaint to News Limited editors, calling Jessica Irvine’s articles published last Sunday an “extreme disappointment.”

Hewitt told News Ltd that he speaks on behalf of  “our 1,800 mortgage brokers and the 6,000 plus home buyers they assist each month,” in expressing what many in the industry perceive to be, at best, an inaccurate depiction of a mortgage broker’s role.

“Your papers gave little credence to the points we raised with the writer when interviewed for the story, or any credit whatsoever for the benefits brokers provide to consumers.”

Hewitt goes on to outline the fact that brokers are overseen by ASIC and that legislation is in place to ensure they provide loans to borrowers that are not unsuitable to the borrowers’ needs.

“You did not conduct any analysis on the commissions paid by different lenders and the volume of loans they write to prove your assertion that commissions influence where brokers recommend customers place their loan.”

He says AFG suggested that Irvine review their competition index report prior to writing her article, but says it appears she “totally ignored” this suggestion.

Hewitt told News Limited that brokers play a major role in promoting competition in a country where the banking system is a “virtual oligopoly.”

“Brokers play a very important role in helping the non-major owned brands and lenders without large branch networks compete and provide competitive options to the big four.”

He finished by reiterating that 50% of Australian home loans are transacted by mortgage brokers.

“The extremely one-sided nature of your story paints a grossly inaccurate picture of a service that is highly valued by the public.”