- Home
- Personal Loans
- News
- Boss of dodgy payday lender cops punishment
Boss of dodgy payday lender cops punishment
A financial services director has been banned from engaging in credit activities for three years after being found guilty of running an unlicensed payday lending business.
ASIC, the financial services regulator, imposed the ban on Robert Legat following the decision by the Federal Court to impose $730,000 of fines on Fast Access Finance Pty Ltd, Fast Access Finance (Beenleigh) Pty Ltd and Fast Access Finance (Burleigh Heads) Pty Ltd.
The court found that the Fast Access Finance companies used a business model that funnelled unlicensed loans to customers through the sale and purchase of diamonds.
“The Federal Court found that the diamond model was designed to conceal the true nature of the transaction, which was the provision of credit. As such, the FAF companies should have held an Australian credit licence under the National Credit Act,” according to ASIC.
“This conduct demonstrated a lack of judgement, integrity and professionalism on Mr Legat’s part and a disregard for the law. ASIC determined that Mr Legat is not a fit and proper person to engage in credit activities.”
Mr Legat has the right to appeal to the Administrative Appeals Tribunal.
Lender wanted to charge excessive interest rates
The Federal Court found that Fast Access Finance provided small-value loans – usually ranging from $500 to $2,000 – after asking customers to sign documents purportedly related to the purchase and sale of diamonds.
ASIC told the court that this was a sham, because there were no diamonds involved in the transaction and consumers had no intention of buying or selling diamonds.
According to the court, the underlying reason for the diamond model was to get around a rule that prevents payday lenders from charging interest rates above 48 per cent per annum.
The court also found that Fast Access Finance and its controlling officers must have had at least a strong suspicion that the diamond model contravened the National Credit Legislation.
In announcing the three-year banning of Mr Legat, ASIC deputy chair Peter Kell said the legislation contains important consumer protections.
“ASIC will take action against people who seek to deprive consumers of these protections,” he said.
Disclaimer
This article is over two years old, last updated on October 9, 2017. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent personal loans articles.
Compare personal loans
6.57%
up to 8.48%
7.19%
up to 13.58%
$920
Australian Credit Licence 488228
Fees & charges apply
- 2024 Award Winner
- 1 to 7 years
- Unsecured
- Fixed Rate
- No ongoing fees
7.99%
8.20%
$940
Australian Credit Licence 238311
Fees & charges apply
- 0 to 7 years
- Unsecured
- Variable Rate
- No ongoing fees
7.24%
up to 9.39%
7.24%
up to 10.31%
$930
Australian Credit Licence 286596
Fees & charges apply
- 3 to 7 years
- Unsecured
- Fixed Rate
- No ongoing fees
6.99%
6.99%
$926
Australian Credit Licence 517589
Fees & charges apply
- 1 to 7 years
- Unsecured
- Fixed Rate
- No ongoing fees
6.75%
up to 26.95%
6.75%
up to 26.95%
$923
Australian Credit Licence 411227
Fees & charges apply
- 2024 Award Winner
- Special
- 1 to 7 years
- Unsecured
- Fixed Rate
5.76%
up to 24.03%
6.55%
up to 24.99%
$909
Australian Credit Licence 474726
Fees & charges apply
- 2024 Award Winner
- 3 to 5 years
- Unsecured
- Fixed Rate
- No ongoing fees
6.57%
up to 8.48%
7.19%
up to 13.58%
$920
Australian Credit Licence 488228
Fees & charges apply
- 1 to 7 years
- Secured
- Fixed Rate
- No ongoing fees
7.49%
up to 13.95%
8.33%
up to 17.58%
$933
Australian Credit Licence 393845
Fees & charges apply
- Via broker
- 1 to 7 years
- Secured
- Fixed Rate
Product database updated 13 May, 2024
Share this page
Get updates on the latest financial news and products
By continuing, you agree to the RateCity Privacy Policy, Terms of Use and Disclaimer.
Promoted personal loans
Low Rate Personal Loan Unsecured (Excellent Credit)
Real Time Rating™
- 2024 Award Winner
- 1 to 7 years
- Unsecured
- Fixed Rate
Interest rate p.a.
6.57%
up to 8.48%
Comparison rate* p.a.
7.19%
up to 13.58%
Australian Credit Licence 488228
Fees & charges apply
Fair Rate Personal Loan Diamond
Real Time Rating™
- 0 to 7 years
- Unsecured
- Variable Rate
- No ongoing fees
Interest rate p.a.
7.99%
Comparison rate* p.a.
8.20%
Australian Credit Licence 238311
Fees & charges apply
Unsecured Personal Loan (Excellent Credit)
Real Time Rating™
- 3 to 7 years
- Unsecured
- Fixed Rate
- No ongoing fees
Interest rate p.a.
7.24%
up to 9.39%
Comparison rate* p.a.
7.24%
up to 10.31%
Australian Credit Licence 286596
Fees & charges apply
Unsecured Personal Loan (Exceptional Credit)
Real Time Rating™
- 1 to 7 years
- Unsecured
- Fixed Rate
- No ongoing fees
Interest rate p.a.
6.99%
Comparison rate* p.a.
6.99%
Australian Credit Licence 517589
Fees & charges apply
Product data updated on 13 May 2024