Sydney broker cops ASIC ban

by Adam Smith16 Apr 2013

 

ASIC has banned yet another broker, alleging false and misleading conduct in relation to more than $4m of loans.
 
The regulator has announced it has dealt Sydney broker Arthur Sperling a five-year ban and cancelled his ACL. An ASIC investigation between October 2010 and November 2011 found Sperling submitted 10 home loan applications to four lenders that the watchdog alleges contained false and misleading information. The loans totalled $4.132m.
 
ASIC said the loan applications contained a number of instances in which borrowers were describedd as working full-time, when in reality the borrowers either did not work for the nominated employer or worked only on a contract or casual basis.
 
The regulator said Sperling failed to independently verify income and employment details before submitting the applications.
 
"In doing so, he has been reckless as to whether the income and employment details supplied to the lenders were false or misleading," ASIC said.
 
ASIC said it cancelled Sperling's licence "on the basis that he is likely to continue to contravene his obligations as the holder of a credit licence".
 
"Failing to verify information submitted in loan applications blatantly disregards the fundamental principles of engaging in credit activities. Those who do not adhere to their obligations will be removed from the industry," ASIC commissioner Peter Kell said.

COMMENTS

  • by Peter 16/04/2013 10:32:35 AM

    This is a grey area:-

    "The regulator said Sperling failed to independently verify income and employment details before submitting the applications."

    This article does not state whether the broker was falsifying the employment details, or was the client giving false information to the the broker?

    Is it up to the broker to call the clients employers to verify the employment details? How far does ASIC want the broker to go?

    I'm all for regulating dodgy brokers but treating clients like criminals is not good for our business.

  • by Country Broker 16/04/2013 10:46:52 AM

    I find the comment 'yet another Broker" to be quite inflamatory , there are at least 10,000 brokers with licences or credit rep status! But we do need these people out of the industry!! , ASIC has banned no more that 15-20 brokers for this type of conduct that is 0.20% of the industry !!!U
    In this case the misleading information was supplied between Oct 2010 and NoV 2011 , yes he is a guilty and should have been checking the information. I also need to ask , were the lenders conducting their own independant checks ?? Perhaps they were if so why has this taken so long to be identified and dealt with , 18 monthns is too long .

  • by Adrian 16/04/2013 11:16:58 AM

    Peter -in response to your comment - "is it up to the broker to call the clients employers to verify the employment details" - the answer is DEFINATELY YES!
    Brokers have the obligation to verify employment and income, so why run the risk of being exposed to fraud etc, when a simple phone call (supported by other document sources) can alleviate the risk!