ASIC has cracked down on misleading advertising by debt resolution firms, which should serve as a warning to borrowers to be diligent when looking to engage with one.
ASIC has taken action again three debt management firms as part of a crackdown on misleading advertising.
Firstly, Capital Debt Solutions Australia Pty Ltd falsely claimed it was 'trusted and recommended by more than 6,000 Australians' and that their debt agreements were 'Government Approved'.
Capital Debt Solutions has now removed these claims and has paid an infringement notice of $10,800.
Debt Assist Aust Pty Ltd also falsely claimed that their debt agreements were 'Government Approved', which have now been removed.
Finally Bankruptcy Experts Pty Ltd had testimonials on their websites from customers that were unable to be substantiated. These have now been removed.
According to ASIC, while debt agreements and debt administrators are regulated, this does not mean they are 'approved' by the government.
“Recommendations and statements, like 'Government Approved' can have a strong influence when vulnerable consumers in financial hardship are seeking help with their debts,” ASIC deputy chair Peter Kell said.
“Firms must ensure their marketing materials and promotional statements are based on fact.”
James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.
He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.
He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.
James holds a BA (Hons) in English Literature and an MA in Journalism.
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