ASIC Investigates Debt Management and Credit Repair Firms

0

ASIC Commissioner Alan Kirkland voiced apprehensions that some of the approximately 100 industry licensees might be participating in unfair or dishonest credit activities, ultimately worsening the financial situations of already vulnerable clients. Reports have surfaced of firms failing to honor commitments made to consumers, raising alarms within the commission.

During the probe, ASIC will review diverse business models within the industry to assess compliance with the law. The industry has been under heightened scrutiny since the implementation of a licensing regime in 2021, aiming to protect consumers from exploitative practices. Since these regulations were put in place, ASIC has already taken legal actions against several entities, including Bakken Holdings, for significant consumer harm.

Bakken Holdings, operator of Solve My Debt Now, was sued by ASIC in August 2023 after accusations of collecting $3.6 million from clients but remitting only $1.1 million to creditors, leaving many customer debts unpaid. Similarly, Chapter Two Holdings Pty Ltd received penalties for allegedly misleading advertising on their website about their debt management achievements.

The review's outcome, anticipated to be published as a public report next year, is expected to shed light on industry practices and offer insights for consumers seeking reliable debt management solutions. ASIC remains committed to taking enforcement actions if any unlawful activities are uncovered during the investigation.

Published:Friday, 25th Jul 2025
Source: Paige Estritori

Share this news item:

Finance News

Clear

US Economy Faces Potential Hard Landing as Tariff Volatility Persists 30 Jul 2025: Paige Estritori The US economy is teetering on the edge of a hard landing, with ongoing tariff disruptions continuing to shake the market, as noted in American Century Investments' latest forecast. Despite some optimism, the challenges persist, keeping hopes for a softer economic transition at bay. - read more

Sydney's Housing Market Surges Amidst Persistent Supply Shortage 29 Jul 2025: Paige Estritori The median price for a house in Sydney soared to $1,722,443 by the end of June, marking a 2.6% quarterly increase and a 4.2% rise year-on-year, according to Domain’s Q2 house price report. This marks the city's fastest quarterly growth in two years and the third consecutive rise. Alongside, unit prices hit a record $834,791, increasing by 1.5% over the same period. - read more

ASIC Investigates Debt Management and Credit Repair Firms 25 Jul 2025: Paige Estritori The Australian Securities and Investments Commission (ASIC) has initiated an investigation into the debt management and credit repair industry, expressing concerns that certain firms may be exacerbating the financial struggles of vulnerable consumers. The inquiry will focus on instances where firms are alleged to have overcharged for minimal services, failed in their contractual communication, or breached the terms of their agreements altogether. - read more

Rate Cuts Ignite Property Interest, But Mortgage Stress Persists 24 Jul 2025: Paige Estritori The Reserve Bank of Australia (RBA) has recently implemented two consecutive 25 basis point cuts to the official cash rate. This has culminated in a notable 34 basis point decrease in the weighted-average interest rate across all existing housing loans in the country compared to the peak rates observed in January 2025. - read more

RBA Surprises Markets by Holding Interest Rates Steady 23 Jul 2025: Paige Estritori The Reserve Bank of Australia (RBA) delivered an unexpected twist at its recent monetary policy meeting by deciding to keep the official cash rate (OCR) at 3.85%. This move contradicted the expectations of financial analysts, who were nearly unanimous in predicting a reduction in the rate. Market forecasts had virtually priced in a rate cut, highlighting the RBA's surprising break from anticipated action. - read more

BetaShares Unveils Trellia Wealth Partners with $8 Billion FUM Following Merger 22 Jul 2025: Paige Estritori BetaShares has announced the launch of Trellia Wealth Partners, a new entity formed through a strategic acquisition. The newly established firm will operate independently, boasting $8 billion in funds under management (FUM) and offering a range of investment options including index-based, active, and bespoke managed accounts. Additionally, Trellia Wealth Partners will provide advanced tools and technology aimed at enhancing efficiency and delivering superior client experiences for financial advisers. - read more