The MFAA has told an inquiry into ASIC’s performance there is no evidence assertions of “systematic falsifications of details in loan applications” are true.
In a submission to the Senate, the MFAA addressed previous submissions from academics, industry bodies and members of the public, which the industry body said implied “widespread misconduct by brokers.
The submission admitted the MFAA had received “a few complaints” during the Senate Inquiry into post-GFC banking sector
in 2012 but that requests for further information were only responded to in one case – the outcome of which was the expulsion of a member.
“As MFAA members comprise a large proportion of Australian mortgage/finance brokers, if there had been widespread misconduct by brokers as asserted by the submissions to this Inquiry, it would be reasonable to expect that many more than one complaint of this nature would have been made by consumers under the MFAA Disciplinary Rules,” said the submission.
Since the establishment of the MFAA Tribunal in 2003, the MFAA has had 383 matters referred to it, resulting in 60 expulsions, suspensions and cancellations.
“Notwithstanding the impact of the NCCP Act and ASIC enforcement, MFAA’s Disciplinary Rules remain in operation and since 2010 have resulted in the expulsion or suspension of some 18 members,” said the submission.
“Many of these were also the subject of ASIC sanctions. However the number of complaints under the MFAA Disciplinary Rules have decreased appreciably since the inception of the NCCP Act.”
“MFAA believes that as the type of behaviour asserted in the submissions to the Inquiry would clearly constitute a breach of the Act (as well as the MFAA Disciplinary Rules), it would not occur under that new regime and the fact that, as far as we are aware, none of the complaints to this Inquiry relate to alleged conduct post 2010 this would demonstrate the effectiveness of the Act.
“It should be noted that the vast majority of expulsions from MFAA membership for false documentation and the like resulted from complaints by lenders believing they had approved loans based on false information, not from consumer complaints.”