ASIC announces ‘mortgage broker accountability’ project

ASIC yesterday outlined its agenda and clarified its regulatory priorities for the next four years.

As part of its Corporate Plan 2019-20 to 2022-23, the regulator will “directly address” the findings of the royal commission, through two new projects pertaining to credit, retail banking and payments, as well as the continuation of four projects already in the works.

One of the new initiatives announced yesterday is a project entitled ‘mortgage broker accountability.’

The regulator described the effort as, “Examining mortgage broker accountability for home loan recommendations, and whether those recommendations align with consumer requirements and objectives.”

However, ASIC also intends to examine lenders more closely with its newly introduced ‘consumers facing financial difficulty’ project, wherein the regulator will review how lenders respond to consumers experiencing financial difficulty, including their debt collection practices.

The continuing projects in the lending space include:

• Holding public hearings as part of the consultation to help shape the regulator’s updated guidance on responsible lending measures
• Collecting and using data on home loans as a tool for improving ASIC’s oversight of industry practices
• Studying and publishing the experiences of over 250 consumers in the process of taking out a home loan
• Reviewing the type and level of fraud in loan applications, the level of consumer harm and industry practices for detecting and responding to loan application fraud

ASIC communicated it will continue “scaling up” its powers to deliver on the program of change detailed in the document.

“The public expects financial firms to treat Australians fairly and live up to the expectations of the community and the law,” said ASIC chair, James Shipton.

“If the firms or individuals we regulate do not, we have the will, the resources and the regulatory tools to hold them to account.”