The regulator has flagged a tougher stance on the conduct of mortgage brokers and aggregators.
The Australian Securities & Investments Commission (ASIC) has put mortgage broking at the top of a list of the regulator’s priorities in credit.
At a keynote address at Credit Law 2025 conference on Tuesday (14 October), ASIC commissioner Alan Kirkland warned that mortgage broking is among its “key areas of focus”, and that the watchdog was actively reviewing brokers’ compliance.
Kirkland noted that home lending was the largest area of consumer credit in Australia and said that as the role of mortgage brokers continues to grow, ASIC will be taking a “closer interest in the conduct of brokers and aggregators”.
“While the sector attracts relatively few consumer complaints, we are conscious that misconduct by brokers will not always be obvious to their customers,” he said.
The commissioner flagged that ASIC had been engaging for some months with several large mortgage aggregators in relation to brokers’ compliance with their best interests obligations.
ASIC has gathered data on brokers’ product recommendation behaviour, loan flows, remuneration, and consumer complaints.
“In the coming months we will be focusing further on brokers’ complaints handling, and audit and compliance practices,” Kirkland said.
“We will review brokers’ compliance with their internal dispute resolution obligations – and seek to understand how brokers identify and respond to complaints that flag potential concerns about compliance with the best interests duty.”
Kirkland said ASIC will also be looking at the audit and compliance practices of large aggregators to understand how effectively they are supervising their mortgage broker representatives and to ensure they comply with their best interests duty.
“If we identify serious issues, we will take appropriate action,” Kirkland said.
Since July 2019, ASIC action against finance and mortgage brokers has resulted in 11 criminal convictions.
A further 22 individuals or companies were removed from credit services, while seven individuals or companies were removed from financial services, and one individual was disqualified from managing corporations.
Kirkland said the action taken by the regulator highlights the “broad range of tools available for us to use in response to any misconduct we may uncover in the course of our review.
“Entities whose conduct causes harm to consumers – or harm to their financial futures – should expect ASIC to take an active interest,” he finished.
ASIC’s crackdown on credit
Two months ago, ASIC announced its strategic priorities for 2025–26, including an “explicit focus” on credit and, in particular, lender responses to financial hardship.
It also included a focus on mortgage brokers, motor vehicle finance, debt management and credit repair, and debt collection.
Last month, ASIC began issuing stop orders to private credit funds over concerns with their target market determinations, amid a larger review of the space.
Days later, the regulator urged industry bodies to lift standards across the private credit sector after a report found concerning practices that needed improving.
Last month, the watchdog also pushed mortgage lenders to focus on improving hardship support for customers in financial distress.
[Related: ‘Enhance standards’: ASIC tells private credit sector]
