ASIC Proceedings Against Membo Finance Over Hardship Requests
Written on the 24 March 2021 by ACA
ASIC has commenced civil penalty proceedings in the Federal Court against Membo Finance Pty Ltd (Membo) and its sole credit representative Richmond Group Financial Services (RGFS). It's for alleged contraventions of the National Consumer Credit Protection Act.
It is alleged that Membo and RGFS failed to comply with the Act when borrowers experienced financial hardship. Membo and RGFS carry on a credit business trading as ClearLoans, which provides loans of between $3,000 and $15,000 on a 12 to 60-month term, with a fixed interest rate of 43% per annum. All loans are secured by a personal guarantee, usually given by a friend or relative of the borrower. In the event of default by the borrower, ClearLoans attempts collection from the guarantor.