ASIC seeks orders against mortgage brokers
The corporate regulator is currently seeking orders in the Federal Court of Australia to stop Sample & Partners, a mortgage broking company, from engaging in misleading and deceptive conduct.
The Australian Securities and Investments Commission (ASIC) alleges the organisation, its director Matthew Sample and its national operations manager Craig Turrell acted in a deceptive or misleading way when conducting initial consultations with their potential clients.
ASIC contends Sample & Partners breached the ASIC Act by enticing consumers to enter into contracts with the company by promoting that customers could pay off their home loan sooner without explaining additional payments would need to be paid to take advantage of this feature.
In addition, the regulator alleges Sample & Partners did not take the customer’s financial situation into account before either making a recommendation to switch to one of its products or recommending a lender from its panel, and held itself out to be an independent mortgage broking company when Matthew Sample had an interest in World Home Loans, which is on the organisation’s panel of lenders.
Further breaches of the ASIC Act have been alleged by the corporate watchdog through Sample & Partners’ actions in telling potential borrowers they could receive insurance and financial planning advice by dealing with the company when no staff were authorised to do so, and the entire market of lenders would be considered before a recommendation was made when only nine lenders were considered.
In response to these alleged breaches, ASIC is looking to obtain declarations from Sample & Partners, Sample and Turrell that they engaged in misleading and deceptive conduct.
ASIC is seeking Federal Court orders restraining the three parties from continuing to make such representations and orders whereby the parties have to implement procedures to allow clients of the company to make a claim for any loss or damages suffered as a result of the organisation’s misleading and deceptive conduct.
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