Deposit difficulties with Buy A Trail

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A series of mortgage brokers have complained of difficulties in obtaining refunds of large deposits paid to Home Loan Selection Services Pty Ltd trading as Buy A Trail, and its director Mark Whittingham.

As reported by Australian BrokerNews yesterday (Trail book broker attempts media gag), complaints include claims of not having trail books supplied after the payment of a deposit, and most consistently, the difficulty or inability of having these deposits refunded. The amounts in dispute have ranged from a few thousand dollars, into the tens of thousands for large trail books.

Bernie Kelly, executive director of newly launched aggregator Trigon Financial, claims he went through what he felt was an “absolute nightmare” experience with HLSS and Buy A Trail. He said “under no circumstances” would Trigon Financial consider dealing with the business again.

Kelly, who is a veteran of the global funds management industry and recently launched the Trigon Financial brand in Australia, said that in the process of building the business, he was interested in sourcing trail books valued “in the millions”.

Kelly said the process of buying a book through HLSS at first “appeared to be above board”, and that the modus operandi employed was “sophisticated”. However, Kelly said he was caught out after paying HLSS a “very significant” deposit.

“Some people think that buyers will simply give up trying to recover funds. In fact most buyers become so frustrated by the process and costs that they simply walk away,” Kelly said. “Our potential loss was very significant, and we made it very clear that the matter would not rest,” he said.

Trigon Financial was eventually successful in having its deposit refunded after 14 weeks.

General manager of Callaghans Financial Services in Adelaide, Michael Williams, engaged legal representation in an attempt to retrieve $15,000 in deposit paid. While initially asked for 50% upfront, Williams said HLSS had eventually lowered the deposit price. However, after paying a deposit, Williams experienced extended delays in setting up a meeting with the seller. Following the investigation by Australian Broker, Williams has indicated he was able to reach a settlement with Buy A Trail.

Kelly and Williiams are only some of the eight mortgage brokers or businesses who have come forward to detail their negative experiences, and many - unlike Kelly - are still battling to get deposits back.

A Victorian-based broker – who refused to be named – told Australian Broker he was currently in pursuit of a deposit valued in the tens of thousands. The broker said after paying the deposit, there had not been much more from Buy A Trail than “piss and wind”.  Likewise, a Queensland-based broker is seeking the return of a 20% deposit paid on a number of loan books, after a deal was struck with HLSS but there were delays in meeting with the seller.

South Australian-based Brian Lucas, from Proper Advice, said he was actually “surprised” when he managed to get his deposit back after three months of “contacting everyone he could” and instructing a solicitor to pursue $4800 in funds. Lucas said after paying the deposit, he sought his money back when the trail book information sent through to him from Buy A Trail contained details that were five years old, causing “something to click”. Lucas said while he got his deposit back, he was forced to spend $1200 on legal fees, and by his calculations $1000 of his own time, chasing up the money over the three month period.

Brokers interviewed by Australian Broker routinely complain of being unable to meet Mark Whiitingham in person, while having severe difficulties in contacting him over the phone, as well as being unable to get meaningful responses or actions as a result of communications via email.

Australian Broker has also obtained a private investigator’s report on HLSS, Buy A Trail and director Mark Whittingham. Contained within, a full Veda Advantage company credit report indicates that Home Loan Selection Services Pty Ltd has a number of defaults listed against it, has been referred to a debt collection agency to recover a sum of money, and also has a number of court judgements – the most recent in 2010 – against it.

Continuing to operate

Buy A Trail continues to advertise trail books in mass mail outs. Email communications sent out by HLSS and Buy A Trail as recently as June advertise a range of trail books from aggregators Connective, VOW, Choice, FAST and Loan Market, with values quoted from $1200 per month up to $20,000 per month. The books advertised are from Victoria, New South Wales, Queensland and Western Australia. It encourages brokers to reply to the email and supply their name and phone number.

Australian Broker has also obtained copies of a Home Loan Selection Services’ initial email contact with interested brokers, which directs them to contact Mark Whittingham with any queries. In the email, HLSS includes a requirement for a deposit of 20% of the agreed purchase price to be paid on the same day of an “acceptance of offer”, but prior to the signing of contracts. The email says this deposit will be “fully refundable” should a broker wish to pull out up until the contract stage. Further, the email to brokers states that if brokers wish to cancel after contracts have been drawn up, a fee of $2,000 would apply, but the balance of the deposit would be returned. The email promises that HLSS will then set up a meeting to go through client files and “have a general chat to the broker” selling the book, completing due diligence. HLSS goes on to say a formal contract will then be drawn up within 7 to 14 days.

When contacted by Australian Broker, Mark Whittingham provided a defence of the Buy A Trail business, labelling the allegations against him as “rubbish”. In response to complaints about the most common complaint – the severe delays in refunding deposits after they had been paid - Whittingham said he was unable to comment as “every case is different”.

“A deposit might have already been paid to a broker, or they might have changed their mind and gone through a different course of action, or they might have asked for another trail book,” he said. “It just depends on the situation at the time, and how quickly someone thinks is a fair and reasonable time to get a deposit back.”

In regard to delays in setting up meetings, Whittingham blamed this on buyers and sellers. “There has been occasions where you can’t arrange meetings in a timely manner, because it is subject to files being ready and brokers wanting to meet at the same time. So, once again it depends on the case, because everyone has their own situation. We’ve also had several brokers that been overseas – and it’s not going to happen tomorrow if you are overseas.”

Whittingham also denied intentionally seeking multiple deposits for a single book. “It would depend on the book. If a sale falls over because a buyer changes their mind or whatever it might be at the time, of course we are going to try the book again. But it is not unless someone has decided to pull out, or the broker selling the book doesn’t want to sell it to them or whatever it might be. We wouldn’t do that on our own devices.” Finally, Buy A Trail does not advertise trail books that do not exist, Whittingham said. “That assertion is totally false.”

Mark Whittingham was able to supply a list of references for his business, and Australian Broker has established that at least two buyers have successfully purchased five trail books between them through the business, while others have managed to successfully sell their books. However, at the time of going to press, no references interviewed could support the business by providing on the record comments. Some referees supplied by HLSS even complained of difficulties and delays in completing transactions.

The final part of the investigation into HLSS and Mark Whittingham will be published tomorrow, including industry responses. The full report can be viewed in edition 8.15, available here.

Related stories:

Trail book broker attempts media gag

  • Old Broker on 20/12/2012 9:22:33 AM

    What I find amazing with all of this is how he got to brokers in the first place... If he generated a mass email campaign where is ACMA ,Where are the people that provided the source of emails. whats going to stop others again from sending out group emails selling a new scam. Why do brokers have to adhere to the spam act and not these guys.. am I missing something here???
    Why are the industry bodies too scared in coming forward in investigating this matter. This is a serious issue this guy could have been stopped a long time ago.

  • Michael Kelly on 19/12/2012 3:51:16 PM

    I won a VCAT case against Mark's company and he still did not refund the money I paid him for 'leads'. It genuinely contributed tothe demise of my fledgling business. The product being oferred changed, and the amounts being requested went up but the process apears to have remained the same. Buyer beware big time.

  • James on 13/03/2012 8:55:18 PM

    Wasn't this man they same person behind the lead generation business that sold postcode based mortgage leads out of Melb a few years back, and had people after him for their monies back???

  • Goodo on 9/08/2011 12:04:36 PM

    How many warning need to be put out about this guy's business practices?

    I saw the emails - did some investigations - saw who was behind the business and walked away.

    I have just bought completed a trail book via my aggregator who has a vested interest in maintaining the integrity the book and having the customers serviced.

  • Colin Williams on 9/08/2011 11:52:34 AM

    I find it hard to believe anyone would have had any dealings with this individual after his lead selling exploits, there was plenty of press coverage and warning signs

  • Todd Hunter on 9/08/2011 11:44:11 AM

    Mark used to also sell leads to brokers that were sold to brokers that paid for a postcode... we purchased three postcodes 4 years ago and the business nor leads never went ahead and we had to pursue mark to get a refund. We contacted MFAA in relation to this and they had already had many complaints from brokers in relation to the same lead generation scheme he was conducting. We didn't receive our money back for 18 months.

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