Tougher regulations under new consumer credit laws
Mortgage brokers will have to be licensed and tougher penalties for irresponsible lending will be introduced as part of an overhaul of consumer credit laws.
The Australian Securities and Investment Commission (ASIC) will get an extra $66 million over four years as part of the overhaul, announced by Superannuation and Corporate Law Minister Nick Sherry on Monday.
The financial regulator will hire 200 new staff to enforce the changes.
“This law will see simple, standard, national regulation of consumer credit for the first time in our country’s history,” Senator Sherry told reporters in Canberra.
“The Rudd Labor government intends to crack down on irresponsible lending, and we intend to weed out dodgy providers of credit finance and dodgy advisers from this industry.”
Senator Sherry unveiled draft legislation aimed at giving greater protection to the more than 5.7 million Australian households that currently hold debt.
The overhaul will see the commonwealth take over eight different sets of regulation and establish a national Australian credit licence regime for lenders and brokers to be overseen by ASIC.
Senator Sherry said he hoped to introduce the bill into parliament in June, with the expectation it would be passed by September.
AAP
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Bradford April 29, 2009
No body in the Lending industry disputes we need to get rid of those who have no intention of doing the right thing by the client. I have done training and more training, certificates till I am sick of the sight of them. When their is a rogue lender/broker and they are reported do the authorities do they ever do anything about these people. Rarely and only if they can have their names in print.
So what will change. From the little I have read the Broker could be sued if the borrower falls on hard times, if you the broker have been lets say understanding of the clients position.
The result, many people who need finance and if were given same would make a success with the funds that you were able to get for that client.
Those and many others will go begging for funds and nobody is going to take the risk unless they are a Blue Chip client.
Why will the authorities change, it will stay the same.
Yes every broker should be accredited, should have done some training and have the same Broker ID which he/ she uses for each lender.
As always the Labor government tries to shift blame from the individual to another person. Yes Brokers are responsible but only for misleading, and making misleading statement or presenting information which is not accurate.