Draft legislation to roll back responsible lending laws a ‘slap in the face’ for banking victims

draft legislation to roll back responsible lending laws a slap in the face for banking victims

Sumary of Draft legislation to roll back responsible lending laws a ‘slap in the face’ for banking victims:

  • Consumer advocates and banking royal commission witnesses who exposed their suffering at the hands of major banks are urging the Federal Government to stop the winding back of responsible lending laws, saying the change could lead to a debt crisis..
  • The Federal Government wants to make it easier for banks to lend money It will do this by winding back responsible lending laws implemented after the banking royal commission Victims say this will impact those most vulnerable to financial harm Treasurer Josh Frydenberg in September said responsible lending laws had led to “restrictive lending”.
  • Even in the depths of Melbourne’s lockdown and in the middle of our first recession in three decades, lending for housing jumped almost 12 per cent, year-on-year in July..
  • The Consumer Action Law Centre, which helped many commission witnesses through the gruelling process, says changing responsible lending laws could lead to trouble..
  • Mr Frydenberg again defended the changes when contacted by ABC News, noting debt collectors would soon need an Australian credit licence, and that responsible lending obligations would still apply to small amount credit contracts (SACCs) below $2,000 and consumer leases..
  • Victims speak out Baptist Minister the Reverend Grant Stewart spoke from the witness box on behalf of his adult son during the royal commission in 2018..
  • The then-26-year-old, who has Down syndrome, was aggressively and unwittingly sold several insurance policies he did not understand after answering an unsolicited call..
  • the Government wants to wind back responsible lending laws.(Peter Healy) Extracts of sales calls illustrated Mr Stewart’s son’s confusion and limited responses, as a Freedom Insurance sales agent spoke quickly and with a thick British accent about the details of the products..
  • In his letter, Mr Stewart thanked the Treasurer for changes to anti-hawking laws and ASIC’s ban on the unsolicited telephone sales of life insurance, but called for protections to be extended, not wound back..
  • “I am disturbed that the Government is now proposing to remove the responsible lending laws, which were introduced after the global financial crisis and that Commissioner Hayne found justified (given the evidence showed the banks were failing to comply with the laws) to attempt to protect consumers from the misconduct of banks,”…

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