The Australian Securities and Investments Commission (ASIC) is warning credit providers and debt management firms – including those geared for the automotive industry – that strong, targeted action is expected in coming months against predatory lending, high-cost credit and misconduct impacting consumers experiencing financial difficulty.
The warning comes after ASIC’s enforcement and regulatory update highlighted more than $30 million in civil penalties secured by ASIC, as well as the commencement and finalisation of court proceedings against some credit providers in the first quarter of 2023.
ASIC continues to sharpen its focus on credit providers and debt management firms, including those who are unlicensed or ‘fringe’ entities, says deputy chair Sarah Court.
“Credit providers and debt management firms that look to take advantage of vulnerable consumers are in our sights and we expect further action in the coming months against operators in this area.
“ASIC’s enforcement action against predatory lending is not limited to court action,” she warns.
“We will continue to use our full suite of powers to protect consumers looking to access credit. This could be via a stop order for breaching the financial product design and distribution requirements or could be warning the company directly via our monitoring and surveillance programs.”
It has also launched its first court proceedings in relation to alleged greenwashing conduct and has issued more than $140,000 in infringement notices in the past six months in response to concerns about alleged greenwashing.
“The enforcement outcomes of the last quarter reflect that we will not hesitate to take swift action where we see misconduct that harms consumers or undermines market integrity.
“Where appropriate, we will also test new areas of the law, as we are doing with our greenwashing and whistle-blower cases,” says Court.
ASIC has also provided guidance to the industry to help with better compliance regarding obligations and to deliver improved outcomes for consumers.
