On one occasion Ormond told franchisees: “Now I've spoken to the ACCC. I've done everything in accordance with the law.” Another time he said “Mate, I've had meetings with Graeme Samuel himself. I have nothing to worry about.”
Ormond admitted to the ACCC to making these statements in contravention of the Trade Practices Act.
“Using the name of the ACCC or individual ACCC officers as a means of discouraging franchisees from exploring their own legal rights is reprehensible,” ACCC chairman Graeme Samuel said.
The ACCC instituted proceedings against Refund Home Loans and Ormond in October last year after receiving a number of complaints.
As a result a court has issued injunctions restraining Refund Home Loans and Ormond from making such representations in the future, ordered corrective statements to all current and some former franchisees, and mandated that Ormond complete training on trade practice law compliance.
Latest Comments
Total:
35
comment(s)
Dave on
15 Mar 2010 10:57 AM
And he is the CEO. Wonder if regulation will really get rid of the cowboys???
Keith on
15 Mar 2010 01:22 PM
I wonder whether he will be welcomed back on ACA given he has always been potrayed as a White Knight...perhaps his franchaise owners see him as the Grim Reaper??
ben on
15 Mar 2010 01:31 PM
so much for him vigorously defending this, instead he rolled over and took the little slap on the wrists, something must have happened for them to see if this went to court he would have been heaps worse off. I bet his adverting budget will have him back on ACA etc
Refund Broker on
15 Mar 2010 03:02 PM
Whats the big deal...at the end of the day at least someone is standing up to the real evils, the banks....every day the big 5 seem to tighten the screws on us, lowering commissions and gulping up the smaller banks (thus taking away choice)....I think we shouldnt look at this one discretion as a summary of Wayne Ormond and all that he''s done for our industry
James on
15 Mar 2010 03:28 PM
Even CEO''s make mistakes and i think it is better he has been honest then waste $$$ on a court case that would be better spent supporting his franchisees. What he has done is honerable and i can tell you very few CEO''s out there have the balls to be honest. The end result from this is positive for all the franchisees not to mention that the training and ongoing compliance in this matter will be better now than any other system. I feel sorry for the other franchise groups that have either sold out to banks, other groups and had their whole businesses turned upside down. And yet people like Mark Bouris have become a reality TV celebrity after he sold his business and i believe disadvantaged all his franchisees that are now having to operate under the Aussie model. I hear that Aussie will slowly but surely take over the Wizard locations and franchisees anyway. So compared to his peers, Mr Ormond is the bad guy for being honest? I think this is great news for the close to 300 franchisees that are part of his brand.
Reputable broker on
15 Mar 2010 04:49 PM
Gee, just a little slap on the wrist. What sort of teeth does the ACCC and legal system have. if as an individual, hard working and reliable broker, I did something I would be hung drawn and quartered. PI would be through the roof and business gone. Hope he''s accountable to someone!!!!!!!!!!!!!!!!!!!!!!!!!
Mark on
15 Mar 2010 06:03 PM
Interesting comments from James about virtuous Wayne. Thank goodness for honesty huh?...it''s dishonesty that got him there in the first place. Behaving like a standover man and being the CEO / boss of a franchise organisation are not mutually exclusive. He''s behaved like a bully and now the chickens have come to roost.
ex-broker on
15 Mar 2010 08:39 PM
how is this punishment?
Peter on
16 Mar 2010 12:14 AM
Thank goodness the ACCC exposed Ormond for the deceiving and manipulating person he is. With his creditability now tarnished, condolences to the some 300 Refund franchisees faced with an uncertain future.
Tony H on
16 Mar 2010 09:53 AM
Either "Refund Broker" and "James" above are looking for promotion within the refund group or this is another spin from Wayne Ormond. He has been proven as a deceitful liar who didn''t follow the rules and he has admitted it. Not sure what great things he has done for the industry other than to bring it into disrepute. Dare say he still gets his fair share of the commission pie from his brokers. ACCC- this is simply deplorable.
ben on
16 Mar 2010 11:05 AM
I agree with tony. possibly spin from above, just like all the other stuff he spouts. stand up to the evils, who does refund broker think we are, or are they just trying to convince themselves that it will all be ok. as to the accc, what a load or manure. again I agree with tony it is deplorable.
James on
16 Mar 2010 11:45 AM
Interesting comments by all... just something further to think about in this debate. The politicians that run this country have on numerous occassions made verbal statements off the cuff that were either exaggerated or untrue yet very few of these leaders ever own up to their mistakes. Ormond is in the same boat. Yes he made some verbal statements that were off the cuff, exaggerated and untrue. But at least he has admitted it and better compliance of this matter put in place for the benefit of the franchisees. I am a refund franchisee and to suggest a promotion in not even relevant. I am a business owner, not an employee. I have actually read the full transcript and know the background of the circumstances and purpose of the meeting where these statements were made. So I am the most qualified here to say that these statements although untrue, really had very little impact or bearing on any franchise in the system. The benefit of this is that even though this is a small issue, the outcome now is better compliance and training and Ormond will now be on notice in this regard from here on which will protect the 300+ franchisees from any further false or misleading statements.
ben on
16 Mar 2010 12:35 PM
interesting defense there james. how did you get access to the full transcipts.I think people would find it interesting the read the truth themselves. rather than hearing more spin and opinions from people who were not involved in the action.
Franck on
16 Mar 2010 01:35 PM
I agree wholeheartedly with Tony and Peter above. Wayne Ormond has brought the industry into disrepute with his nonchalant attitude and complete disregard for the rules. On one hand it is just deserts that he has been exposed as a self-admitted and deceitful liar through proceedings in the Federal Court, but on the other hand it is disappointing considering the leniency handed down by the ACCC. Leopards don’t change their spots; be wary existing and potential franchisees.
Dave on
17 Mar 2010 09:16 AM
Refund should refund $$ for the pain and hurt to select current or ex-Franchisees. At $70k a pop can afford to do so.
At the end of the day he does have a unique selling point.
ben on
17 Mar 2010 03:37 PM
its not just his unique selling point along with a few others that have that same selling point. refundhomeloans.info have them ranked as the lowest refund to customers out of 6 models they compared.
Broker on
17 Mar 2010 04:07 PM
Given todays commission levels, who in their right mind would refund a portion of their upfronts unless they also charged their clients a fee for service, which Refund don''t do ,right?
The mind boggles!
Spinner on
17 Mar 2010 08:11 PM
Given the large up front time input to lodge a deal, rigourous questions by lenders (that consume resources), if you work it out, your probably on $9.00 an hour. Measure it and see. Unemployed get around $6.00 per hour, so for $3 per hour your making the bank, customer and CEO money. May have been a proposition when 0.7% upfront & 0.25% trail, but the game has changed, What happens in the next round of comm cuts? whooops - who keeps the trail if you decide its too hard?
ben on
18 Mar 2010 12:56 PM
ineteresting point spinner, in any franchise system, if you choose to leave who does keep the trail. I have been told that in this system you do not keep the trail when you leave.
Broker on
18 Mar 2010 01:37 PM
In a franchise model, if you leave before your term expires , you lose the trail, leave when your terms expires and take the trail with you.
Cap on
30 Mar 2010 01:02 PM
I agree with many of the above comments with respect to the punishment. It certainly would not seem to fit the crime. We brokers on the other hand would, as one repondent stated, be hung drawn and quartered. As for Ormond pleading guilty, I beleive it was the lesser of the evils. Get a slap on the wrist and avoid a lengthy court case that may involve closer scruitiny of the whole refund management system. In my years in this industry I have found that where there is smoke there is fire. Ormond in my oppinion is a bully who struts around lording it over frinchise owners. His management team treat him like some sort of god and virtually hang on every word spoken. As for the way franchisees are dealt with.One only has to look at the way exiting franchisees are dealt with. You buy a franchise for $65-$70K 12 months later when you discover it is not working for you or you are not suited to the industry you are offered around $20-$24K. Come on Wayne there is no way you could convince me that this is fair trading. You are capitalising on exiting franchisees desperation to your own ends. And in turn placing them at a distinct financial diadvantage. Maybe this is one of the things you wanted the court not to find out. After all why insist on all exiting franchisees agreeing to strict confidentiality clauses. The mind boggles
John Harvard on
30 Mar 2010 09:28 PM
I note Refund want to be a broker in all things to all people from home oans to accounting. I note they advertised for staff recently - what a high pressure role that would be. Push to sign new blood would be relentless - these guys are parasites on the industry. Why would a broker want to join a group that wants to specialis in everything and succeed in nothing
insider on
31 Mar 2010 03:20 AM
WHAT A GREAT BUSINESS MODEL!!!!!!!!!
why didn''t i think of that.
sell it at $70k, feed them hope for 6mths and then bully them with breach notices and if, only if you have the guts to stand up to him then he might let you exit with nothing.
AND yes you guessed it, the vacant territory then gets re-sold.
and by the way james, "what he has done is honorable"
wayne only admitted to the charge because he was caught and trying to avoid media exposure. there is nothing honorable about that.
Mick MD on
08 Apr 2010 09:45 AM
It''s funny how the shonky operators in our industry often win awards. This is another example. Sadly most awards in our industry are a "colouring competition", you write your own submission and nobody really checks the truth or bonafides of nominees. Everyone on the inside has known for many years to avoid Mr O and his business. I feel sorry for his many victims.
ryan on
08 Apr 2010 02:57 PM
He should be shut down. This is a disgrace to our industry, He is a loud mouth and thinks he can write his own rules. ACA should be after him and splash him all over Australia as a shonk
business owners? on
08 Apr 2010 05:17 PM
interesting.
broker on
08 Apr 2010 05:21 PM
i didnt realise that franchisees were excused from doing their own due diligence, would you not believe this to be more imperritive where there is a financial commitment in dollars as well as time?
Spinner on
09 Apr 2010 01:09 AM
Broker, How much due diligence are you able to do?
Applicants are not merchant bankers, rely on the likes of Mr Ormands representations to make their decisions. Should be manditory that the franchisor provides a list of all people that left in the last 12 months and their ph no. What information are they given?
ben on
20 Apr 2010 10:32 AM
hey there keith, it didnt take too long before wayne was welcomed back at today tonight. they are always happy to show him as the little auusie battler while ignoring the real pain he puts the industry and people through.
Prospect on
26 Apr 2010 08:18 PM
I weas asked to interview by these guys in Melbourne recently for some Franchise BDM roles. I am glad i knocked the opportunity back looking at the above comments.
Broker Watcher on
27 Apr 2010 03:55 PM
"Should be manditory that the franchisor provides a list of all people that left in the last 12 months and their ph no. What information are they given..."
IT IS...under the changes to the franchise code it is mandatory for a franchisor to provide details of all franchisees that terminated, were terminated or did not renew in the past 3 years in the franchise disclosure document. This information is to include the name and contact number of the former franchisee(s) unless they request otherwise.
ben on
28 Apr 2010 09:57 AM
they are supposed to hand out all of the details, however there is no one to check if those details are correct and accurate, there is also noone to who makes sure that the exiting francisee is not being bullied into not going on the document. then you dont get previous docs so how would you compare to see if they are being truthful. the disclosure documents and the laws in place to govern it are a joke and people like this know it and are able to work around it. one interesting place to look is the courts websites, the federal court and the supreme court are different, this group and the main director have some interesting cases from the past and present. on both supreme and federal along with government inquiries. Sure am glad I am not involved with the likes of them.
Max on
13 Dec 2010 10:47 PM
Ormond and his cronies are all Bullies, ask the previous Vic state manager who has been pushed out the door. bulled ostracised ridiculed victimised and polarised - yes they are pretty strong words if you don’t believe it just go and join then you will end up telling your own story.
AusRes on
03 Jan 2011 06:53 PM
I agree max. they are a pack of bullies. have you seen some of the attacks on internet forums. Nice lot they are. It is sad that the ACCC let down so many. and rhls mates in the ACCC arent even willing to follow thru with any sort of justice. if they did maybe people would stop being bullied. I have heard of threats to person and property when they dont get their own way. even more people just walking away grateful becasue rhl wont charge them ongoing fees if they leave....which they are not aloud to do anyway.
KT on
13 Jan 2011 01:07 PM
Any business that refunds a significant portion of its hard earned revenue (commission refunded to borrowers) is a recipe for disaster. RHL were trying to undercut its broker competitors but with rent, wages and overheads to run a business, you can''t survive. Trying to make up for it by increasing volume will ultimately diminish the quality of the advice provided to their customers.
Whatsmore, its gonna get worse for RHL when banning exit fees legislation kicks in and you will see more borrowers refinance. The commission clawback is going to ultimately send RHL broke. If I was them, I would hold about half of their upfront commission earnt in the past 18 months in a bank savings acocunt, just in case they need to repay clawbacks in the coming years.
Terrible and flawed business model that attempted to cheapen the value of mortgage brokers work. Glad to see RHL go under, as well as all the other "cheap" brokers that rebate upfront commission to their clients.