Powered by MOMENTUM MEDIA
SUBSCRIBE TO OUR NEWSLETTER SIGN UP
Powered by MOMENTUM MEDIA

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

ASIC flags credit repair risks

asic ta  asic ta
Reporter 4 minute read

The regulator is running a month-long campaign to warn consumers about the risks associated with seeking credit repair and debt management services.

The Australian Securities and Investments Commission (ASIC) has announced that it will commence a month-long campaign — along with the commonwealth, state and territory governments — designed to inform consumers of the high level of fees charged by credit repair and debt management firms.

ASIC claimed that consumers may be left worse-off, with some firms failing to adequately address the credit and debt issues of their clients.

“Consumers experiencing money or debt problems don’t need to put themselves under further financial stress by paying high fees to firms providing credit repair and debt solution services,” ASIC deputy chair Peter Kell said.

Advertisement
Advertisement

“If people are having difficulty obtaining loans because of an incorrect default listing on their credit report, there are actions they can take that are free of charge to have it corrected.”

Mr Kell urged consumers who suspect that a credit default has been wrongfully listed against them to contact their creditor.

“If you aren’t satisfied with the response you receive, you can contact the relevant dispute resolution service for help,” the deputy chair added.

The campaign follows on from a 2016 ASIC report which found that debt management firms:

  • were offering services where fees and costs were not well explained;
  • often required payments be made before services were provided;
  • sometimes used high-pressure sales techniques.

Mr Kell noted that consumers could consider alternative services like financial counselling before engaging a debt solutions firm.

PROMOTED CONTENT


Further, ASIC stated that consumers should be aware that lenders will review their credit report when they apply for credit or a loan and they should check that their credit history details are correct, adding that consumers are entitled to obtain one free copy of their credit report each year from a credit reporting agency.

[Related: ASIC to ‘intensify scrutiny’ of licensing applications]

ASIC flags credit repair risks
asic ta
TheAdviser logo

If you’re feeling overworked and overwhelmed in this fast-paced mortgage market, it’s time to make some changes, and the Business Accelerator Program can help! Early bird tickets are on sale now. Work smarter, not harder, this year.

asic ta

 

more from the adviser
handshake news Ex-broker head to lead MyState banking

A former broker head has returned to MyState Bank to tackle turna...

BBS 2021 ta SA/NT’s top brokers crowned

The leading brokers in South Australia and the Northern Territory...

Paul Kearney ta AFCA recruits from ME Bank

The complaints authority has named a new executive general manage...