Banned broker serves as industry warning

According to an article in smartcompany.com.au, the mortgage brokerage industry has issued a warning, saying brokers should be proactive in confirming customer information or risk facing the wrath of the industry regulator.

The warning comes after the Australian Securities and Investments Commission (ASIC) banned a mortgage broker for five years after he delivered loan applications with false or misleading information.

The incident raises questions about how serious ASIC is about policing this type of information even though their powers have been significantly expanded under the new National Consumer Protection Legislation.

Sydney-based Arthur Sperling of Statewide Financial Services was banned and his credit licence revoked after it was found he said some applicants had worked full-time, but in reality they had either not worked at the companies listed in the application, or only worked on a casual or part-time basis.

Phil Naylor, the chief executive of the Mortgage and Finance Association of Australia, said that now ASIC has jurisdiction over this area, the market has been watching closely to see how hard it is on brokers who break the rules.

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