ASIC has announced that has commenced proceedings in the Federal Court against credit assistance provider Lightspeed Finance Pty Ltd and its sole director Mark James Fitzpatrick for failing to comply with AFCA determinations.
AFCA made two determinations about a dispute by a borrower in relation to a loan for home construction arranged by Lightspeed but documented as a business loan. The mortgaged property was sold after default. Both determinations for reduction of the loan balance were accepted by the borrower and were binding on Lightspeed under the AFCA rules.
ASIC’s court action seeks declarations that Lightspeed breached section 47(1)(m) of the National Consumer Credit Protection Act by failing to give effect to the determination of the Australian Financial Complaints Authority as required by Regulation 11A(2)(c) to the National Consumer Credit Protection Regulations 2010.
Failure to co-operate with AFCA is a civil penalty offence with penalties of $10,500,000 for a company and $1,050,000 for an individual.
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Author: David Jacobson
Principal, Bright Corporate Law
About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.