Loans Broker 'misleading'
The Age
Tuesday December 12, 2006
THE corporate watchdog claims national mortgage broker Sample & Partners has engaged in "misleading or deceptive conduct" to encourage home owners to switch loans.
The Australian Securities and Investments Commission has begun Federal Court proceedings against companies trading as Sample & Partners. These include GMS Group (NSW), GMS Group (Vic) and GMS Group Holdings, as well as a director of the companies, Matthew Sample, and national operations manager of Sample & Partners, Craig Turrell.According to ASIC, Sample & Partners representatives cold-called potential borrowers to arrange an appointment, usually at home. During this initial consultation, ASIC alleges potential borrowers were asked to enter into a contract with Sample & Partners. ASIC alleges the defendants breached the ASIC Act by telling potential borrowers: ? That by switching to a loan arranged by Sample & Partners they would save money and pay off their home loan sooner, but failing to explain that borrowers would need to make extra repayments.? The financial circumstances of borrowers would be considered before making a recommendation. ASIC alleges that an individual's actual expenses were not considered.? Sample & Partners was independent from lenders - despite Mr Sample having an interest in World Home Loans, which is on Sample & Partners' panel of lenders.ASIC also alleges that Mr Sample, Mr Turrell and companies trading as Sample & Partners breached the ASIC Act by telling potential borrowers that "certain named clients received benefits in switching to Sample & Partners' loans, when in fact those clients did not exist".Yesterday, the "Testimonials" link on the Sample & Partners website was no longer accessible.In seeking a restraining order, ASIC alleged that representations made by Sample & Partners were also being made by other mortgage broking companies associated with Mr Sample. The matter will return to the Federal Court in Sydney today.
© 2006 The Age