Broker demands 'frank conversation' about NCCP

by Julia Corderoy28 Jan 2016
A Melbourne-based broker and former CEO of the Australian Institute of Professional Brokers has penned an open letter to the regulators, government and central bank demanding a “frank conversation” about the National Consumer Credit Protection Act (NCCP) and the role of the regulators.

In the open letter, Maria Rigoni, founder and owner of Universal Wealth Management, has called out the regulators for “financial exploitation”.

“It is fact that regulators, in recent times, have interfered where they have no right to,” Rigoni wrote.

“ASIC and APRA have caused loan repayments to be more expensive for borrowers and lender profits fatter.

“The regulators make subjective judgement calls about how people are able to use their personal assets, investments, and cash flow, even when those calls are in conflict with the intention of current legislation.”

Speaking to Australian Broker about her open letter, Rigoni said ASIC’s recent crackdown on interest-only lending was the last straw for her, especially when she was not able to refinance a responsible client into an interest-only loan for their benefit. 

“Lenders have said ASIC has approached them and ASIC’s opinion is if people want interest-only loans to keep their repayments low then the lender should not accommodate them. The client’s requirements and objectives which make [an interest-only] loan a 'not unsuitable' loan have been ignored. ASIC have turned around and said it should be an unsuitable loan,” Rigoni said.

“ASIC are just open-slather going to lenders and saying this is what we believe and it is just nonsense. My client now can’t refinance from his current lender to a new lender at a cheaper interest rate. His not unsuitable loan has been turned into an unsuitable loan, but where does he go to get that fixed?”

According to Rigoni, this illustrates the lack of protection the current consumer protection laws offer and the need for a complete overhaul of the NCCP.

“The NCCP is nonsensical consumer protection. The consumer protection laws are not protecting the consumer and they are not protecting me either," Rigoni told Ausrtralian Broker

“What I would like to see is a total overhaul of the NCCP. The whole focus of the NCCP does not give any power for a borrower to be a responsible borrower. It is all about the lender having the power and control.”


  • by L Best 28/01/2016 9:13:22 AM

    I agree with the comments made - applicants/borrowers must also be accountable and responsible for their own decisions and regulators (and the politicians that wrote the bad law - the NCCP) should stop forcing lenders to be the regulator.

    Any loan decision should be shared - an equal responsibility for the decision to borrow and the decision to lend should be 50/50 between the parties. Not a decision that is borne 100% by the lender. We are dealing with adults that should understand and make informed decisions for themselves, with guidance from their legal and financial advisers.

    Also allowing, in hindsight, to decide a legally produced and executed contract can be changed/altered/amended arbitrarily by an external dispute resolution service (that is a misnomer if ever there was one) acting as an advocate for the borrower is also a travesty of any form of justice.

    Scrap the whole Act and start again and look for a measured an equal means to regulate.

  • by James 28/01/2016 9:18:00 AM

    If investment loan margins were increased to cool home price growth on the eastern seaboard, at what stage in the cycle will the margins be reduced? With Sydney house prices decreasing at the largest rate since 1993 now is the appropriate time. I applaud your efforts to balance the conversation.

  • by Broker 28/01/2016 9:31:45 AM

    Vote #1 - Maria to become the ASIC CEO.

    The noise that we all have to listen to from ASIC and APRA of late is too stupid to be true.