Broker sentenced in false statement case

The sentencing has come after the court found that Mr Gao failed to take reasonable steps to ensure that he did not make a statement that was false or misleading in a material particular in a credit licence annual compliance certificate lodged with the Australian Securities and Investments Commission (ASIC).

SCI previously held an Australian Credit Licence and operated a mortgage brokerage business in Ryde, Sydney. Mr Gao was the sole fit and proper person and responsible manager of SCI’s credit licence. Mr Gao was also the sole mortgage broker for SCI’s business.

In April 2016, Mr Gao had his lender accreditation with ANZ suspended. In May 2017, he lodged a compliance certificate with ASIC on behalf of SCI, in which he stated that none of SCI’s fit and proper people had accreditation cancelled or suspended by a lender.

The statement was false or misleading in a material particular because Mr Gao (as SCI’s only fit and proper person) had his accreditation with ANZ suspended.

The offending is contrary to section 225 (6) of the National Consumer Credit Protection (NCCP) Act 2009.

ACL holders are required to identify the people involved in the management of their credit business, known as fit and proper people. They are also required to annually lodge an ACL compliance certificate with ASIC, in which licensees are required to certify that they are complying with their credit licence obligations.

Mr Gao was previously charged with making a false statement in October 2020, where he entered a plea of not guilty.  

In March this year, Mr Gao pleaded guilty to one count of failing to take reasonable steps to ensure that he did not make or authorise the making of a false or misleading statement in any material, particularly in a compliance certificate.

SCI’s credit licence was cancelled by ASIC in November 2018 under section 54 of the NCCP Act.

[Related: Mortgage broker banned for seven years]