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ASIC Warns Consumer About Credit Repair Services

Thursday, June 28, 2018 - Posted by Michael McCulloch

Throughout the month of June 2018 the Australian Securities and Investments Commission (ASIC) ran a public campaign designed to inform consumers of the high level of fees charged by credit repair and debt management firms.

The campaign aimed to highlight the alternative approaches available to consumers rather than paying high fees for a service that they may not receive. These available options include approaching the Creditor concerned about an adverse listing on a credit report, utilising a service such as financial counselling or contacting the relevant external dispute resolution centre if the original complaint cannot be resolved after going through internal dispute resolution.

This is a follow-up campaign to the 2016 ASIC report which found that credit repair and debt management firms:

  • were offering a service where fees and costs were not well explained;
  • often required payment be made before services were provided; and
  • sometimes used high-pressure sales techniques.

You may recall that ASIC has previously pursued enforcement proceedings against one credit repair company in Queensland which we covered in our July 2017 edition.

Peter, Kell, ASIC Deputy Chair, reminded consumers that they are entitled to one free copy of their credit report each year from a credit reporting agency.

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