Red Flags

Although there is an expectation that lenders will lend responsibly, and borrowers will only borrow what they need and can afford to repay – we know that this is highly unlikely.

While the changes to the act will make some of these predatory actions illegal, they will still occur.

The Red flags is a resource designed specifically for consumer advisers such as financial mentors, and others helping people in debt. It is intended to empower advisers to better identify unlawful conduct and assist their clients to resolve problems with lenders. It also enables the identification of potential non-compliance and to report it to the Commission.

Here is some information for each Red Flag:

If you (or your clients) encounter any of these actions, you can contact the Commission and let them know what happened. They will assess the information you provide according to criteria such as:

• the extent of the harm
• the seriousness of the conduct and
• public interest in the matter.

Following an assessment, the Commission will decide whether to take further action.

Since 2015 the Commission has prosecuted 13 mobile traders, prosecuted (and closed) multiple ‘pay day lenders’, and have sent Owners/Directors to prison.

But these types of organisations continue to pop back up, and our clients continue to borrow from them.

You can download your own copy of the Red Flags here:

Red-Flag-information-sheets-October-2021

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