Millions in commissions unclaimed

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Brokers who fail to regularly reconcile their upfront and trailing commission statements are seeing millions of hard-earned commission payments either forfeited to their aggregators or held in unclaimed/unmatched commission accounts.

National Finance Institute managing director Peter Heinrich has issued a warning to brokers that the incidence of unclaimed or unmatched commissions is a "very common problem" in the industry, and that some aggregators may be holding millions in unpaid payments.

"Some brokers mentioned to me recently they had been quite slack about reconciling their commmissions from their aggregators and found when they did they were owed several thousand dollars," Heinrich said. "One broker who spoke to me said that because he was very quiet at the moment he reconciled his loan book and found he was owed over $40,000 in unclaimed or unmatched commmissions."

Some brokers forfeit their upfront and subsequent trail commission if not claimed within 12 months of receipt by the aggregator, while some aggregators retain commission entitlements if not claimed by members in a time period as short as three months.

Reasons for unmatched commissions can include having more than one surname on the loan, leading to commissions being paid on an alternate name, or names being listed out of order.

Heinrich said the blame for the problem primarily lies with brokers who fail to reconcile their commissions monthly to ensure they are paid for settled loans. In some cases, aggregators are also not being proactive in matching commissions they are holding in their accounts.

 

  • wayne smith on 1/11/2010 9:14:29 AM

    agrevators
    who needs them never used one
    Im Not giving away away % to do a deal
    You suckers

  • Michael Kinens on 29/10/2010 6:18:34 PM

    Dave, I am disappointed to hear that your experience has not been positive, and whilst I would suggest that this isn’t the widespread experience of our users, the last thing we wish to do however is ignore your issue. Unfortunately I would make direct contact but haven’t been able to establish your contact details from this post. I am keen to hear from you, so welcome your call to me directly (03 90185800). Do we have a manual? Help is provided via an online manual. As you can appreciate, given the breadth of our solution, combined with the need to keep this information up to date given the effort placed into ongoing enhancements, it would be impractical to produce a printed manual. This approach is consistent with other technology specialists across the software industry. Again I would be happy to better understand why you were not aware o this.

  • Angela Gorham on 20/10/2010 9:06:55 AM

    Maybe i should fire in an employment application at Australian Loan Company! Surely Debbie''s comments are career limiting.

  • CJ on 19/10/2010 3:30:31 PM

    Debby Wilson''s comment "...they take enough of your money" says it all! especially considering she''s the BDM of this aggregator!!...Im not so sure your brokers would be too pleased with this comment!

  • Debby Wilson on 18/10/2010 4:29:27 PM

    I am actually with Australian Loan Comapny as an aggregator and they find the broker and pay him any money owing to them. ALCO has no unclaimed money and has always found the rightful owner of the money.. Thats what all aggregators should be doing looking after the brokers. They take enough of there money.

  • Spinner on 12/10/2010 9:23:17 PM

    Well, I guess its settled then (excuse the pun).

    MFAA, as a fragmented industry, individually we will not be heard, but as an organisation we will. This is the opportunity to demonstrate value to the members.

    Given this is material amounts and obviously a slush fund for aggregators, what can you do for your members interests?? I think thats the question here.

  • Dave on 12/10/2010 11:15:24 AM

    To David Johnson: The aggregator should because it''s their responsibilty, they get paid the money and as each and every agreement states they pay it to us. Simple.

    To Michael Kinens: Yes IRESS offers a solution (and so do at least 6 other suppliers) but the reason most brokers don''t use your software is because of the poor support and communication. Do you have a manual? No! If you put some resources into the back end you might actually get somewhere.

  • Michael Kinens on 11/10/2010 3:26:50 PM

    It is quite frustrating to read about these issues given that we (IRESS) have developed and market a solution which allows advisers and brokers to record what they are expecting to receive in remuneration payments against each transaction, against which payments are automatically matched, making the identification of unpaid payments quite straightforward. So in short, the solutions are there – why aren’t they being used?

  • Phil on 11/10/2010 12:09:38 PM

    EVERY loan gets submitted with a broker id. Its an absolute disgrace that we have to keep an eye on commission payments. What IS it exactly that Aggregators do? And yes clearly if there is a problem the MFAA should do something about it. Our yes that right they will have the typical line - thats contractual issue we don''t get involved. As MFAA is not a requirement we should all not renew until they actually do something. If they think they can survive with just a select few bigger groups, then let them.

  • Steve L on 11/10/2010 12:08:52 PM

    Sorry, please remind me again.....WHO do the Aggregators work for?

  • ThePatrician on 11/10/2010 11:59:45 AM

    These are not "unclaimed commissions", they are unpaid commissions. Aggregators have a contractual obligation to collect, verify and forward all commissions. One major aggregator used to advertise in their recruitment ads. for new brokers "we relentlessly chase down all commissions". Said it, but didn''t do it. Try and get an aggregator to contact a lender about an incorrect clawback? Good luck with that one. The fact is Lenders pay incorrect commissions, aggregators don''t check them or correct them, brokers miss out.Oh I forgot - all this is the Brokers fault, as usual.

  • Paul on 11/10/2010 11:14:06 AM

    Are we not running our own businesses? As a business owner, is not the first rule to ensure YOU have been paid for the work you have done? Seems to me there is a lot of buck passing here. I believe it is up to YOU to check your own trails and stop balming everyone else.

  • Andrew on 11/10/2010 11:14:05 AM

    I think as brokers we are a angry cynical bunch.
    Although of late I think we have every reason to be.
    Our treatment on all levels is appalling - Banks, Aggregators, Professional Bodies, ASIC.... the list goes on.
    When will respect and decency be restored to our profession so we can once again hold our heads high and be proud to be Brokers?

  • David Johnson on 11/10/2010 11:06:01 AM

    If an individual broker cannot keep track of their commissions, why should the aggregator have too?

    These brokers should get off their backsides, it is just plain lazy. Who else but the individual broker knows exactly what loans they write??

  • Patrick on 11/10/2010 11:01:39 AM

    Dave makes a very good point. I am both a financial planner and a mortgage broker. As a financial planner I have changed Dealer Group twice. In each case my trailer income transferred in full with me. Why does this not happen with Aggregators? If we could transfer the whole of our business including trailers, this new and appropriate level of competition would ensure we get treated as customers rather than indentured serfs. Where is ASIC and ACCC? Asleep as usual.

  • Dave on 11/10/2010 10:51:23 AM

    EVERY payment from EVERY lender states the broker''s ID number, it is easy for aggregators to match this to you....if they want too. By finding a payment anomaly such as a wrong surname the aggregator can then put the payment into their slush fund for their xmas party of xmas bonus all at the expense of their customer...YOU the mortgage broker. This is one area of the industry that has long been overlooked because it effects mortgage brokers only have often wondered why the MFAA and FBAA have never lobbied the aggregators on this issue.....oh that''s right it only effects mortgage brokers. And to the mortgage broker who found $40K how much interest did your aggregator pay you???? Yes I thought so! One day (and hopefully soon) as a mortgage broker I might actually be treated like a customer/client from one of my many suppliers.

  • Patrick on 11/10/2010 10:50:19 AM

    Why would aggregators care, does anyone think they are philanthropists. They are greedy parasites.

  • Spinner on 11/10/2010 10:48:34 AM

    This money should be held in trust with a duty upon the aggregator to find the rightful owner.

    By holding the funds, are they not unclaimed monies that should be remitted to the government after 7 years?

  • Adrian Buscombe on 11/10/2010 10:30:57 AM

    I believe that all Aggregators owe a Duty of Care to make ever effort to pay these outstanding commissions.

    I believe with all the programs available to the Aggregators it should not be too hard to assist us with a program to make it easy to reconcile commissions.

    There should be some method to access the orphans account.

    I look forward to reading other brokers thoughts.

  • Greg Cook on 11/10/2010 10:05:53 AM

    I dont know how many times I have asked that commissions be held in a secure web site so that brokers can view loan records to claim. EG loan number changes and your trail stops unless you locate this change and track down the new loan number you cannot cliam it and the process is poor to do so. More work needs to be done in this area for reconcilliation

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