Following a slew of permanent bans and convictions against brokers announced yesterday, ASIC has sent a strong message to “rogue operators” in the industry.
ASIC has revealed it is currently investigating 20 cases of falsification of loan documents or applications, while stating that fraud by brokers "will not be tolerated".
reported yesterday that ASIC has permanently banned two Sydney-based brokers and one former mortgage broker while announcing the conviction of another
The announcements were released in quick succession by ASIC, and all related to falsification of loan documents or applications.
An ASIC spokesperson told Australian Broker
the regulatory body has “identified significant falsification of loan documentation by mortgage and finance brokers” through reports from AUSTRAC, lenders, industry bodies and consumers.
ASIC has been “very active” in investigating matters of this kind, said the spokesperson.
There are currently 20 cases under investigation by ASIC relating to falsification of loan documents or applications.
“Two of them involve large, ongoing, systematic conduct,” said ASIC. “The remainder appear to involve falsification of documents on a smaller number of transactions motivated by self-benefit."
ASIC was quick to acknowledge these cases are not representative of the broking industry as a whole.
“The spike in action we have taken does not suggest the industry is faltering. However, it should act as a reminder to everyone that there are still rogue operators out there who, contrary to the majority, don’t have the interests of the consumer or the industry front-of-mind.
“ASIC will take enforcement action where brokers engage in fraud or other misconduct regarding information provided in loan applications. This is clearly in the interest of all reputable brokers, as well as lenders and consumers.”
ASIC took over the regulation of consumer credit on 1 July 2010 under the National Credit Act. Prior to this, consumer credit was primarily regulated by the states and territories under the Uniform Consumer Credit Code (UCCC).
“Since the start of the National Credit Act, ASIC has been actively regulating the mortgage broking industry. Our aim is to raise standards and increase consumer confidence, and where possible to work with the industry to drive out poor practices,” said ASIC.
“The new legislation is there to protect consumers. At the end of the day, we expect brokers to operate with honesty and integrity, and in accordance with their responsibilities.
“If brokers break the law, they will hear from us. In particular, fraud by brokers will not be tolerated.