Friday 27 October 2006 LAWFUEL – Law News Network – The Australian Securities and Investments Commission (ASIC) has commenced proceedings against Canberra-based mortgage broker, Tonadale Pty Ltd (trading as ACT Mortgages), and Mr Kelvin Skeers, following allegations of unconscionable and misleading and deceptive conduct in relation to the arrangement of lo-doc loans.
These proceedings in the Federal Court of Australia follow an investigation by ASIC into the conduct of Tonadale and Mr Skeers, an employee of Tonadale, in the arranging of two lo-doc loans for a client in August 2004 and November 2005. ASIC alleges that Tonadale and Mr Skeers acted in breach of the ASIC Act by: • arranging two lo-doc loans that the borrower could not afford to repay • misrepresenting the borrower’s financial position to the lender in the application forms and • misrepresenting to the borrower what would be included in the borrower’s loan application forms.
ASIC is seeking: • declarations that Tonadale and Mr Skeers engaged in misleading and deceptive conduct or conduct that was likely to mislead or deceive, and unconscionable conduct when the loans were arranged • an order restraining Mr Skeers, in certain circumstances, from lodging loan applications • an order that Tonadale and Mr Skeers pay compensation to the borrower and • orders that require Tonadale to establish compliance, education and training programs and review its internal operations. The matter is before the Court for directions on Thursday 9 November 2006. Background Lo-doc loans are loans in which the lender determines eligibility by relying on statements by the borrower that they can meet the repayments, rather than requiring proof of income. For further information contact: Jan Redfern Executive Director, Enforcement Telephone: 02 9911 2191 Mobile: 0411 119 210 Emma Forehan ASIC Media Unit Telephone: 03 9280 3354 Mobile: 0409 702 310