ASIC announced that has launched legal proceedings against Gold Coast-based credit repair business, Malouf Group Enterprises Pty Ltd (Malouf Group), and its director Jordan Francis Malouf.
ASIC alleges that between 1 January 2014 and 31 December 2015, Malouf Group made false or misleading representations and engaged in unconscionable conduct in the operation of its credit repair business, including by representing to consumers that Malouf Group could remove negative listings from their credit file when in fact often nothing could actually be done about the listings. ASIC also alleges that in some cases there was nothing in fact wrong with the consumer’s credit file. Malouf Group usually charged consumers a fee of $1,095 for its services.
ASIC is seeking:
- declarations that Malouf Group made representations that were false or misleading, and engaged in conduct that was misleading or deceptive and unconscionable;
- declarations that Mr Malouf was knowingly concerned in the contraventions by Malouf Group;
- orders to stop Malouf Group and Mr Malouf from continuing to make false or misleading representations;
- fines;
- refunds for consumers; and
- orders requiring Malouf Group to establish compliance and training programs and to publish corrective notices.
The maximum penalties for breaches of the Australian Consumer Law are $1.1 million for a corporation and $220,000 for an individual.
The proceeding has been listed for a directions hearing in the Brisbane Federal Court on 12 July 2017.
Background
ASIC has commenced these proceedings in the Federal Court following delegation of power from the Australian Competition and Consumer Commission. The delegation gives ASIC functions and powers under the Competition and Consumer Act 2010 to regulate conduct (including taking enforcement action) in relation to credit repair and debt collection.
Malouf Group trades under various business names including Credit Wash, Credit Clean Australia, Credit Fix Australia and Clean Your Credit.
The collection and reporting of data about consumers’ credit histories is regulated by Part IIIA of the Privacy Act 1988 (Cth) (the Privacy Act). Consumers can seek to have defaults on loans and other credit infringements “negative listings” removed if the listing is incorrect or did not comply with the requirements of the Privacy Act.
Consumers who want further information about credit repair should visit ASIC’s MoneySmart website: Credit Repair.