ASIC is toughening its National Credit Act enforcement by issuing infringement notices and requiring enforceable undertakings rather than an informal resolution.

ASIC has accepted an enforceable undertaking (EU) from Mr Graham Rendell, the owner and operator of Perth based lender, Key Credit, following concerns there may have been underlying weaknesses in Key Credit’s compliance processes regarding implementation of legislative changes, and borrowers may have been misled in relation to Key Credit’s ability to repossess essential household property listed as security for their loans.

Key Credit has also paid a penalty of $5,500 after ASIC issued five infringement notices under the National Consumer Credit Protection Regulations 2010 (Cth).

Under the EU, Key Credit has agreed to contact each affected borrower informing them that the mortgages over their essential household property are void and not enforceable, and that if borrowers default in their loan repayments, Key Credit will not and cannot take possession of that essential household property.

Key Credit will also engage an independent compliance consultant to review and report to ASIC on Key Credit’s compliance with the credit legislation.

Key Credit paid five penalties of $1,100 each in compliance with the infringement notices.

Compliance with the notices is not an admission of guilt and Key Credit is not taken to have been convicted of the offence specified in the notices.