Mortgage Choice has been forced by ASIC to more than $30,000 in penalties for false advertising.
The mortgage broker, with over 800 representatives and 160 franchises nationally, has paid $30,600 in penalties for three infringement notices issued by ASIC.
The advertisements, which aired on multiple television stations around Australia and two websites between February 2012 and November 2012, said that Mortgage Choice had refinanced numerous home loans and on average saved customers ‘$10,000 over 5 years’.
However, the savings of $10,000 over 5 years were projected savings based on calculations from a sample number of around 300 refinancing customers over a six-month period. No savings of $10,000 over 5 years had been achieved by any customer at the time of the advertisement.
ASIC issued three separate infringement notices to Mortgage Choice, one for representations made in the television advertisements, and two for the representations made on the websites. Each infringement notice had a penalty of $10,200.
Deputy Chairman Peter Kell said ASIC will continue to ensure consumers are not lured into financial products as a result of false or misleading advertising.
"Advertising plays a crucial role in the decisions consumers make, and any claims made about savings a consumer might make need to be accurate and supported by evidence. ASIC will continue to act in instances where advertisements contain representations about a product that are false or misleading," he said.
The payment of an infringement notice is not an admission of a contravention of the Australian Securities and Investment Commission Act 2001 consumer protection provisions. ASIC can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer protection laws.