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ASIC to crackdown on unlicensed lenders

by Staff Reporter8 minute read
The Adviser

Staff Reporter

In a bid to rid the industry of unlicensed loan sharks, the corporate regulator has launched a new compliance campaign.

The campaign, which is scheduled to run until 30 March 2012, follows a previous ASIC surveillance program between October 2010 and February 2011 which found a number of credit providers were not appropriately registered.

Under the new national consumer credit laws, individuals or businesses who engage in credit activities are required to hold an Australian Credit Licence, or be an authorised representative of a credit licence holder.

ASIC’s latest surveillance campaign is aimed at identifying traders who applied for a credit licence, but withdrew their application, or had it refused. In those circumstances, unless the trader is an authorised credit representative, or subsequently obtains a credit licence, they cannot engage in credit activities.

“ASIC will identify and may later prosecute individuals and businesses who fail to make sure they’re properly licensed or authorised under the regime,” ASIC commissioner Peter Boxall said.

“Engaging or utilising the services of unlicensed credit operators puts the public at risk. Consumers need to be confident that they’re dealing with authorised businesses who are gatekeepers of our financial services industry.”

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