Choice slams Refund administration bungle

by Adam Smith17 Nov 2011

Choice has decried the treatment of Refund franchisees by the company's administrator, calling upon the administrator to "meet their moral obligations".

The aggregator's CEO, Stephen Moore, told Australian BrokerNews Choice has continued to pay commissions for franchisees, but the payments have not made it past administrator SV Partners.

"I confirm Choice continues to meet our obligations, including commission payments. We paid all commissions due to Refund in October; however, it appears franchisees didn't see a cent of this," Moore said.

Choice has sent "numerous communications" to SV Partners for direction on commission payments. Moore said the aggregator had sought assurances that franchisees would be paid their commissions, but had been given no confirmation that the administrator would pay full commission entitlements to Refund brokers.

"We understand SV Partners have written to franchisees stating they will pay part commissions on new loans only," he said. "Unfortunately, the longer things drag on, the less certain the outcomes for Refund brokers."

Australian BrokerNews has also made numerous attempts to contact SV Partners, and has not received response. Moore said the administrator had an obligation to Refund franchisees.

"While we understand an administrator has responsibilities, we are strongly encouraging them to meet their moral obligations. Refund brokers are doing it tough at the moment and we should never forget that these are hardworking people looking to earn an income and look after their families," he said.

Moore said Choice would "continue to go into bat" for Refund brokers, and was in regular contact with the company's franchisees.

"We are encouraging brokers not to make any rash decisions, and to seek their own legal advice on entitlements and obligations," he said.

If you're a Refund franchisee affected by the company entering voluntary administration, and would like to share your story, contact Adam Smith at


  • by Patrick McMenamin 17/11/2011 12:17:15 PM

    The agreement with Refund no doubt provides that trailers are forfeit in the event of insolvency. Are the downstream franchisees and brokers Choice's concern? If the Administor of Refund acts other than in the interests of secured creditors first then unsecured creditors they would be liable. Brokers and franchisees are not creditors they have a "chose in action" interest in the income of Refund, but only whilst Refund is a solvent going concern. Choice owns the trailers now and could offer ex-Refund brokers and franchisees a portion of these trailers as an incentive to sign up direct with Choice. I have been telling brokers for years and years that their whole business survival is dependent upon good financial management by their relevant aggregator. Wake up people, wake up ASIC, wake up ACCC this is an industry wide time bomb.