Australian Securities and Investments Commission v Rent 2 Own Cars Australia Pty Ltd

GREENWOOD J: 1 These proceedings are concerned with two matters. 2 The first concerns the extent to which civil pecuniary penalties are to be imposed upon each of the respondents to the principal proceeding. The second concerns the period of the restraint provided for by an injunction restraining the second and third respondents as contemplated by the observations in the "Primary Judgment" at 436 of the reasons published on 11 September 2020: Australian Securities and Investments Commission v Rent 2 Own Cars Australia Pty Ltd [2020] FCA 1312. 3 These reasons ought to be read together with the extensive reasons published in the Primary Judgment, otherwise described as the "Liability Judgment". 4 In these reasons, the defined terms adopted in the Primary Judgment are also used in these reasons. 5 For the sake of immediate convenience, the principal defined terms are these: Australian Securities and Investments Commission Act 2001 (Cth) (the "ASIC Act"); Australian Securities and Investments Commission ("ASIC"); National Consumer Credit Protection Act 2009 (Cth) (the "NCCP Act"); National Credit Code (the "Code" or "National Credit Code"), Schedule 1 to the NCCP Act; Corporations Act 2001 (Cth) ( the "Corporations Act"); Evidence Act 1995 (Cth) (the "Evidence Act"); Federal Court of Australia (the "Court"); Rent 2 Own Cars Australia Pty Ltd ("R2O"); Australian Credit Licence ("ACL"); Timothy James Roberts ("Mr Roberts"); Paul Anthony Green ("Mr Green"); individual means a "non-corporate person". 6 In the primary judgment at [436], the Court summarised the relief to be granted in the proceedings in the following terms: 436 The following relief is to be granted, framed in appropriate terms: (1) A declaration that R2O contravened ss 32A, 23(1), 17(4) and 17(5) of the National Credit Code by engaging in particular conduct framed to take account of the findings in these reasons. (2) A declaration that Mr Green and Mr Roberts were knowingly concerned in the contraventions by R2O of ss 32A, 23(1), 17(4) and 17(5) of the Code framed according to the findings in these reasons. (3) A declaration that R2O contravened ss 12DA, 12DB(1)(a) and 12DB(1)(g), framed according to the findings in these reasons. (4) A declaration that Mr Green and Mr Roberts were knowingly concerned in the contraventions by R2O of the ASIC Act provisions in suit framed according to the findings in these reasons. (5) Injunctions restraining R2O, Mr Green and Mr Roberts from, respectively, engaging in contraventions of ss 32A, 23(1), 17(4) and 17(5) of the National Credit Code or being knowingly concerned in the contravention of any of those provisions of the Code by another. ASIC seeks an injunction restraining the respondents from engaging in credit activity, or being involved in a business engaged in a credit activity for a particular period as the Court determines appropriate. An injunction directed to this conduct is to be granted. However, the parties will be given an opportunity to be heard further on the question of what is an appropriate period for such a restraint. (6) An injunction restraining R2O from engaging in further contraventions of ss 12DA, 12DB(1)(a) and 12DB(1)(g) of the ASIC Act and an injunction restraining Mr Green and Mr Roberts from engaging in conduct constituting being knowingly concerned in contraventions of those provisions of the ASIC Act. (7) As to the question of a pecuniary penalty, ASIC seeks an order against R2O for payment of a penalty in relation to its contraventions of ss 32A, 23(1), 17(4) and 17(5) of the Code. ASIC also seeks a pecuniary penalty order in respect of R2O's contraventions of ss 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. ASIC also seeks a pecuniary penalty order against Mr Green and Mr Roberts in respect of their conduct of being knowingly concerned in R2O's contraventions of ss 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. 7 On 1 March 2021, the Court made orders giving formal expression to the above relief subject to the determination of the quantum of pecuniary penalties to be imposed upon the respondents and the terms of the proposed injunctions. For convenience, the operative parts of the orders (and definitions) and Tables 1 and 2 to the orders are attached to these reasons as Annexure A. 8 Those orders require the following explanation. 9 So far as relief against R2O is concerned, the Court made a declaration that between 1 March 2017 and 18 June 2018, R2O contravened s 32A of the Code by entering into credit contracts with an annual cost rate that exceeded 48% in respect of 140 credit contracts marked with an "X" in Column A of Table 1. Table 1 is divided up into the 2017 credit contracts otherwise known as the "First Tranche" of contracts and the 2018 credit contracts otherwise described as the "Second Tranche". 10 The Court also declared that, in that period, R2O contravened s 23(1) of the Code by entering into credit contracts that imposed a monetary liability on consumers in respect of an interest charge in contravention of s 32A of the Code in respect of the 140 credit contracts marked with an "X" in Column B of Table 1. 11 The Court also declared that, in that period, R2O contravened s 17(4) of the Code by failing to disclose the annual percentage interest rate applicable to the credit contract in respect of 187 credit contracts marked with an "X" in Column C of Table 1. 12 The Court also declared that, in that period, R2O contravened s 17(5) of the Code by failing to disclose to the consumer the method of calculation of the interest charges payable under the contract in respect of 232 credit contracts marked with an "X" in Column D of Table 1. 13 The Court made three further declarations concerning R2O. 14 The Court declared that between 1 March 2017 and 18 June 2018, by charging an interest rate higher than the rate represented on the credit contract in relation to 177 credit contracts marked with an "X" in Column E of Table 1, R2O contravened s 12DA(1) of the ASIC Act by engaging in conduct in relation to financial services that was misleading or deceptive or was likely to mislead or deceive; R2O contravened s 12DB(1)(a) of the ASIC Act by making false or misleading representations in connection with the supply or possible supply of financial services, that its services were of a particular standard, quality, value or grade; R2O contravened s 12DB(1)(g) of the ASIC Act by making false or misleading representations in connection with the supply, or possible supply, of financial services with respect to the price of the services. 15 As to the relief granted against Mr Roberts, the Court declared that between 1 March 2017 and 18 June 2018, Mr Roberts was knowingly concerned in the contraventions by R2O of: s 32A of the Code in relation to 108 credit contracts marked with an "X" in Column A of Table 2; s 23(1) of the Code in relation to 108 credit contracts marked with an "X" in Column B of Table 2; s 17(4) of the Code in relation to 142 credit contracts marked with an "X" in Column C of Table 2; s 17(5) of the Code in relation to 232 credit contracts marked with an "X" in Column D of Table 2. Table 2 is also divided up into the 2017 credit contracts and the 2018 credit contracts. 16 Apart from those declarations, the Court also made a declaration that between 1 March 2017 and 6 September 2017, in relation to 133 credit contracts marked with an "X" in Column E of Table 2, Mr Roberts was knowingly concerned in the contraventions by R2O of ss 12DA(1), 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. 17 In relation to Mr Green, the Court made declarations that he was knowingly concerned in R2O's contraventions, in the terms described at [15] of these reasons by reference to Columns A, B, C and D of Table 2. 18 The Court also declared that Mr Green was knowingly concerned in R2O's contraventions of ss 12DA(1), 12DB(1)(a) and 12DB(1)(g) of the ASIC Act as marked with an "X" in Column E of Table 2. 19 Tables 1 and 2 of Annexure A set out all of these matters in a consolidated summary form. 20 Particular restraining orders were made at Orders 7 to 12 inclusive of the orders made on 1 March 2021. 21 In the amended originating application, the relief claimed by ASIC so far as pecuniary penalties are concerned, is this. 22 As to R2O, an order pursuant to s 113(1) of the Code that R2O pay a pecuniary penalty in respect of the contraventions of ss 32A, 23(1), 17(4) and 17(5) of the Code. 23 As to Mr Roberts, an order pursuant to s 12GBA(1)(e) of the ASIC Act that Mr Roberts pay a pecuniary penalty in respect of his involvement in the contraventions by R2O of ss 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. 24 As to Mr Green, ASIC similarly claims pursuant to s 12GBA(1)(e) of the ASIC Act an order that Mr Green pay a pecuniary penalty in respect of his involvement in the contraventions by R2O of ss 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. 25 On 25 March 2021, the company was placed into external administration with Mr Brendan Nixon of SM Solvency Accountants appointed as liquidator of R2O. On 19 April 2021, Ms Irma Schoch, a lawyer employed by ASIC, sent a letter to Mr Nixon seeking to determine whether Mr Nixon would give written consent to ASIC continuing with the civil penalty and injunction aspect of the proceeding. On 20 April 2021, Mr Nixon confirmed that he raised no objection to ASIC proceeding with this part of the proceeding. 26 On 19 May 2021, the Court granted leave under s 500 of the Corporations Act to proceed against R2O in liquidation. However, R2O was deregistered pursuant to s 509(1) of the Corporations Act with effect from 30 September 2021 and by virtue of s 601AD of that Act, the company ceased to exist upon deregistration. In these reasons, I propose to identify the factors that inform a pecuniary penalty that would otherwise have been imposed on the company in liquidation both because it reflects the Court's assessment of the character and severity of the conduct of R2O and it may assist in identifying the principles to be applied even though no pecuniary penalty can now been actually imposed on R2O as it has, by reason of the deregistration event, ceased to exist. 27 The evidence relied upon by ASIC in this part of the proceeding is set out at paras 5, 6 and 7 of ASIC's written submissions. Mr Roberts relies upon an affidavit sworn 3 December 2020. Mr Roberts is represented by Mr Gallo of counsel. Written submissions have been put on, on his behalf. Mr Green is self-represented and has put on short written submissions. 28 Apart from the affidavit material recited at paras 5, 6 and 7 of ASIC's written submissions, ASIC also seeks to rely upon the affidavit of Ms Irma Schoch sworn 27 April 2021. Mr Green objects to leave being given to rely on the affidavit. I will return to the basis upon which ASIC seeks to rely on written representations made by Mr Neil Gooch of Galbraith Loop, Erskine, Western Australia, contained in an email sent to Ms Schoch on 8 April 2021 and representations made by Mr Scott Lumsden to Ms Schoch in an email dated 6 April 2021 later in these reasons. ASIC seeks to rely upon these representations under s 64(2) of the Evidence Act, ASIC having given notice to the respondents in compliance with s 67 of that Act. R2O is, of course, and has always been, a party to these proceedings. 29 Before turning to those matters, Ms Schoch deposes to these matters supported by documents annexed to her affidavit. On 9 February 2021, Mr Green lodged with ASIC an application for the voluntary deregistration of R2O. In that application, Mr Green declared that R2O was not a party to any legal proceeding (para (f) of the declaration). Mr Green certified that matter to be true and complete (in the sense of accurate and without any omission). ASIC has deferred that application. 30 Ms Schoch also deposes to these matters. 31 On 1 July 2018, the franchisees of R2O ceased entering into credit contracts and commenced entering into car "hire agreements" with customers on behalf of a company called Auto Access Solutions Pty Ltd ("AASPL") (formerly described as "R2O Enterprises Pty Ltd"). Under the hire agreements, consumers rent a used car by paying a fee or security bond and then paying a weekly rental fee either for a fixed term or in some cases an indefinite period. Mr Green has been a director of AASPL since 30 June 2018 and sole director since 20 December 2018. The sole shareholder in AASPL is PWMZ Pty Ltd ("PWMZ") which holds two ordinary fully paid shares. Mr Green was a director of PWMZ between 3 February 2014 and 1 September 2018 and between 1 March 2019 and 15 October 2020. The sole director and shareholder of PWMZ is Mr Green's wife, Ms Wendy Green. 32 As part of its investigations in relation to matters relevant to AASPL and matters touching upon the present proceedings, ASIC issued notices to 11 of the 14 franchisees between 5 November 2020 and 14 December 2020 seeking a list of customers that had made a payment since 1 August 2020 in relation to any credit contract entered into with R2O or a franchisee of R2O before 1 July 2018. As a result of exchanges between ASIC and the franchisees, documents were produced which reveal that four franchisees were continuing to collect monies from customers under R2O credit contracts entered into prior to 1 July 2018. Of those 151 customers, two were customers within the pleaded cohort of customers the subject of the civil penalty proceeding and the Liability Judgment and they are Mr Michael Keen who was continuing to make payments to an R2O franchisee in Adelaide South, and Mr Hosea Hinga, who was continuing to make repayments to an R2O franchisee at Mandurah, Erskine. 33 The solicitor for the R2O franchisee at Adelaide South is Mr Scott Lumsden, a partner of the firm Wallmans Lawyers in Adelaide. Mr Lumsden, on behalf of his client, provided certain information to Ms Schoch. Mr Neil Gooch is the principal of the R2O franchisee at Mandurah, Erskine, and he provided information to Ms Schoch. 34 As to Mr Lumsden, he sent an email to Ms Schoch on 6 April 2021 attaching a letter dated 5 April 2021 addressed to ASIC in which he provided the following information (and made the following statements) in relation to what he described as a credit contract between R2O and Michael Keen dated 9 June 2017: Payment ceased on 10 December 2020 as the contract was paid out on this date. I asked Paul Green why ASIC was after [the] particular info [at Question 4 of ASIC's email to Mr Lumsden: "Are repayments still being made under the R2O Credit Contracts? If not, please provide the date when repayments ceased and details as to why repayments ceased"] and he advised me that these are/were in a name [R2O] that is not registered to trade in credit (or something along those lines), to which I replied then why were we not made aware of this before now? He insinuated this was my fault for some reason. Several of the contracts in Q4 are still going because the customers are way behind with their payments. 35 As to Mr Gooch, he sent an email to Ms Schoch on 8 April 2021 responding to Ms Schoch's questions set out in her email to him of 7 April 2021. He made these statements: Mr Hinga's contract was from 14 June 2018 and there were no variations. Mr Hinga's contract wasn't cancelled until 7/12/20 so falls into the period 1/9/20 - 20/11/20. … Prior to cancellation of Mr Hinga's credit contract … repayments [were] being made [by] Paysmart … to the franchisee directly. 36 Question 6 put to Mr Gooch by Ms Schoch and his reply were in these terms: 6. What directions, if any, did [R2O] provide the franchisees about the continued collection of repayments from Mr Hinga in relation to his credit contract dated 14 June 2018: a. following the commencement of ASIC's investigation in 2017; and b. prior to, at the time of, after, or otherwise in relation to, [R2O's] surrender of its Australian Credit Licence on or about 3 March 2020. None to my recollection. 37 ASIC served a notice dated 22 April 2021 on the respondents under s 67 of the Evidence Act. Section 67 provides that s 64(2) of that Act does not apply to evidence adduced by a party unless that party has given reasonable notice in writing to each other party of an intention to adduce the evidence. The notice must be given in accordance with the Regulations (s 67(2)) and state the matters required by s 67(3). Section 64(2) provides for an exception to the hearsay rule by providing that the rule does not apply to evidence of a representation given by a person who saw, heard or otherwise perceived the representation being made; or to a document (which, by reference to s 3 of the Evidence Act, Dictionary, is such as to include an email) so far as it contains the representation (or another representation to which it is necessary to refer in order to understand the representation), if, in either case, "it would cause expense or undue delay, or would not be reasonably practicable, to call the person who made the representation to give evidence". 38 In this case, ASIC's proposition is that it would have created delay and would have caused expense and would not have been "reasonably practicable" to make arrangements and incur the expense of bringing Mr Gooch from Western Australia and Mr Lumsden from South Australia, to Brisbane, to give oral evidence of the representations set out in the emails as quoted in these reasons. I accept that that is so and that the notice of 22 April 2021 meets the requirements of the Evidence Act and Regulations. 39 The affidavit of Ms Schoch of 27 April 2021 is admitted into evidence as to all matters to which she deposes. The letter from Mr Lumsden of 5 April 2021 (Annexure "ITS-35") and the email from Mr Gooch dated 8 April 2021 ("ITS-40") are both probative of the representations contained within the emails as quoted earlier. 40 The ultimate point of the focus upon the representations made by Mr Lumsden and Mr Gooch is this. On 3 February 2020, Mr Green on behalf of R2O, filed a request with ASIC for the cancellation of R2O's ACL. The reason stated by Mr Green for the surrender or cancellation of R2O's ACL was that R2O "does not trade in credit activities and has not traded in credit activities since 30 June 2018". R2O's ACL was cancelled on 4 March 2020 (that is, in the period between the trial of the issues on liability in this proceeding and pronouncement and publication of the Liability Judgment). However, the inquiries conducted by Ms Schoch and the questions asked by her of R2O franchisees revealed that payments were continuing to be received from R2O customers under credit contracts entered into with R2O. Relevantly for present purposes, of those contracts, two concerned credit contracts within the pleaded cohort of credit contracts the subject of these proceedings and the Liability Judgment, namely, the contracts with Mr Keen and Mr Hinga. In response to the emails from Ms Schoch (concerning Mr Keen and Mr Hinga), Mr Gooch and Mr Lumsden set out representations confirming that in each case, the credit contract had not been varied, assigned or refinanced; that no direction had been received from R2O concerning repayments from the credit contract customer following the surrender of R2O's ACL and that the contracts thus remained as credit contracts between R2O and the customers as considered in the course of the proceedings. Repayments continued to be received from Mr Keen and Mr Hinga from 4 March 2020 (the date of cancellation of R2O's ACL) until December 2020. 41 Thus, so far as Mr Keen and Mr Hinga are concerned, R2O continued to act as a credit provider under each credit contract and R2O continued to perform the obligations of a credit provider or exercise the rights of a credit provider in relation to each contract (one of the important rights being the right to receive the weekly payments under each contract) and thus R2O continued to engage in the statutory conception of "credit activity" for the purposes of the NCCP Act in the period 4 March 2020 to December 2020 concerning those two contracts notwithstanding the cancellation of R2O's ACL on 4 March 2020. Section 29 of the NCCP Act prohibits a person from engaging in credit activity without holding a licence authorising the person to conduct that activity. 42 As earlier mentioned, Mr Green objects to the admission of the evidence of the representations which, if admitted, would be probative of the conduct just described between March 2020 and December 2020 concerning Mr Keen and Mr Hinga and thus probative of unlicensed credit activity. In his email response of 1 May 2021 to ASIC's notice of 22 April 2021 under s 67 of the Evidence Act to adduce the evidence described earlier and to rely upon the affidavit of Ms Schoch of 27 April 2021 (served on 27 April 2021), Mr Green said this: I do strongly object to the filing of the material for these reasons; 1. The material is very flawed in the fact that there are only 2 Franchisees that cannot recall being directed to not collect payments on R2O credit contracts after the licence was surrendered, if I could be bothered or thought it would make any outcome different, I could submit evidence and witnesses that would totally discredit this waffle, with one of these witnesses in Ms Schoch's affidavit being documented as replying to my direction that he "did not care what ASIC laws say he was going to continue to collect because the money was owed to him" strange that he did not mention that!! 2. The main and most important objection is that ASIC is blatantly, disgustingly wasting resources and tax payer funds chasing nothing but a narcissistic motivated witch hunt just to hang a scalp on the wall or for some staffers corporate gain which ASIC is now famous for, knowing full well that the outcome will be NOTHING, there is very obviously some other motivation to this squandering. 3. There is no monetary outcome for ASIC … because it is very unlikely that any money will be raised or available to cover any imposed fines on the company or any of the respondents, the company is in liquidation. … 43 It is correct to say that Mr Green seems to be suggesting that, consistent with the surrender (cancellation) of the ACL on 4 March 2020, the R2O franchisees were directed (by someone) to not collect payments on R2O credit contracts after the surrender of R2O's ACL and that only two franchisees have been relied upon where collections occurred and in the case of those franchisees the contended difficulty is that they cannot recall the "direction". Mr Green also says that he could "submit evidence" to "totally" contradict the concerns in Ms Schoch's affidavit (and the emails), but was not bothered to do so as he considers doing so would make no difference in these proceedings. 44 It is unfortunate that Mr Green did not seek to demonstrate that franchisees of R2O had been directed by him or someone to not collect payments under the various credit contracts after the surrender of R2O's ACL if that is what happened, and particularly if he caused it to happen. 45 However, Mr Green's "main and most important objection" is the matter set out at point 2 above in the emphatic language it adopts, presumably reinforced by the observations at point 3. As to those matters, and Mr Green's comments reflected in the quoted paragraphs, it is clear that as at 1 May 2021 (the date of his response), Mr Green had not recognised or come to grips with the fact that R2O engaged in the very large number of contraventions set out in Table 1 to the orders of 1 March 2021 (see Table 1, 232 credit contracts, Columns A to E, comprising 140 contraventions of s 32A; 140 contraventions of s 23(1); 187 contraventions of s 17(4); 232 contraventions of s 17(5); and 177 contraventions of ss 12DA, 12DB(1)(a) and 12DB(1)(g). Nor has Mr Green come to grips with having been "knowingly concerned" in a significant number of R2O's contraventions: see Table 2 of Annexure A. 46 As to Mr Green's comments about the state of R2O, its capacity to pay a pecuniary penalty and his lack of interest in the period of the restraint, the current state of R2O is due, no doubt, in large part to the circumstance that it engaged in the very large field of contraventions described in Table 1 to the orders of 1 March 2021 and that Mr Green and Mr Roberts were knowingly concerned in the field of contraventions described in Table 2 of the orders of 1 March 2021. In addition, all of those contraventions by R2O and the knowing concern of Mr Green and Mr Roberts in relevant contraventions as described in Table 2 to the orders of 1 March 2021 had a direct effect upon each consumer the subject of the credit contracts. If R2O, Mr Green and Mr Roberts are not capable of guiding the affairs of R2O according to law (especially in relation to such a large number of contracts), plainly enough, ASIC as the regulator, finds itself in a position where it must enforce the law. 47 The remarks of Mr Green set out at point 2 of his email as quoted at [42] of these reasons are absurd in the circumstances of this case. 48 As to this part of the proceeding on the question of penalty, the evidence demonstrates that of the 232 contracts in issue in the proceeding, R2O engaged in unlicensed credit activity between March 2020 and December 2020 concerning two of those contracts: Mr Keen and Mr Hinga. That circumstance is a relevant matter to consider in relation to the respondents when determining the pecuniary penalty to be imposed in respect of the conduct the subject of the orders of 1 March 2021. 49 As to the findings arising out of the Liability Judgment, counsel for Mr Roberts recognises that Mr Roberts did not contest the liability trial and undertook to abide by the findings in the Liability Judgment. To the extent that ASIC's summary of those findings accurately puts the position, that summary is not in contest. I will examine the particular matters put by counsel for Mr Roberts, later in these reasons. Mr Green has a number of things to say about R2O's conduct and his own conduct in his brief written submissions of 29 December 2020. To the extent that he challenges the findings of fact, the Liability Judgment has addressed those matters. I will address Mr Green's observations later in these reasons. Accordingly, I will simply set out the unchallenged summary, recognising of course that these reasons and the summary ought to be read in conjunction with the Liability Judgment which extensively addresses the factual matters. I am satisfied that the summary is accurate. 50 The relevant summary is this.

Findings and contraventions 51 R2O provided credit to consumers through a hire-purchase type of credit contract for the purchase of second-hand motor vehicles. R2O held an ACL for that purpose and operated its business through a franchise network of motor dealers. At 17 July 2017 and 26 July 2018, there were 21 franchisees operating in Queensland, New South Wales, Victoria, South Australia, Tasmania and Western Australia. Each franchisee or a person employed by the franchisee, held a Motor Dealer Licence within the relevant State jurisdiction. For each franchisee, R2O authorised the franchisee entity or person, and/or one or more persons employed by the franchisee, to be a "credit representative" of R2O under s 64 of the NCCP Act enabling that person to engage in "credit activity" on behalf of R2O. 52 Between 1 July 2012 and 26 July 2018, R2O entered into 5,930 credit contracts and as at 19 April 2018, R2O had 2,239 credit contracts on foot. The proceeding concerns 232 contracts made between R2O and consumers. Those credit contracts fall into two tranches. The First Tranche comprises 142 contracts made between 1 March 2017 and 6 September 2017. The Second Tranche comprises 90 contracts made between 25 May 2018 and 18 June 2018. The Court considered a particular contract between R2O and a selected consumer in each of the two tranches on the accepted footing that those contracts were representative of each of the contracts within the two tranches respectively. 53 A consumer entering into a contract with R2O was required to make a first payment as part of the transaction and a number of regular payments thereafter with title typically passing upon the exercise of an option to acquire title in the used car on payment of the last repayment (although the actual mechanism for passing title may not necessarily have worked in that way). Accordingly, having regard to the period of the payments, interest was a component of the amount of each repayment: see Liability Judgment at [24]. 54 The Court found that the credit contracts were subject to the requirements of the NCCP Act and the Code: Liability Judgment at [185]. Specifically, the contracts were goods leases with an option to purchase such that for the purposes of s 9 of the Code, they were regarded as contracts for the sale (of the relevant used car) by instalments, regulated by the Code. 55 In relation to the credit contracts, the Court observed that in order to distil the calculus of factors into a quantified regular repayment over the term of the contract, R2O provided the franchisees with a number of "price calculators" from 16 August 2016 in the form of a "Microsoft Excel" calculator for the purpose of determining the "weekly repayment" under the contract for a stated interest rate and contract term. Mr Green provided six such price calculators to the franchisees by email: 16 August 2016, 10 November 2016, 14 December 2016, 19 January 2017, 1 November 2017 and 11 April 2018, Liability Judgment at [24]. 56 The circumstances in which R2O offered pricing guidance to franchisees (such as how the used cars were "priced" and how a "mark up" was to be determined, including the evolution of that practice and the creation and use of various versions of the "price calculators") was considered extensively by the Court in the Liability Judgment at [287] to [366]. 57 The Court also considered the chronology of the dealings between ASIC and R2O in which ASIC expressed concerns about R2O's calculation of credit charges. The Court expressed these observations in the Liability Judgment: (1) On 25 February 2017, Mr Green sent an email to Mr Wills providing a description of the formula used in his pricing calculator. The description of the formula shows that Mr Green understood that interest was being applied by R2O to the cash price before taking into account and subtracting the deposit. (2) On 9 March 2017, a conference occurred between officers of ASIC, Mr Green, Mr Roberts and Mr Wills, by means of a teleconference. The minutes of the meeting record the serious concerns identified by ASIC in relation to the calculation of charges and whether the charges being imposed on the consumer entering into the credit contract were within the 48% rate cap. ASIC officers told Mr Green, Mr Roberts and Mr Wills in very clear terms that R2O was not calculating its charges correctly and that based on ASIC's analysis, R2O was exceeding the 48% cap. (3) On 16 March 2017, ASIC sent an email to Mr Wills seeking further information about R2O's calculation of charges under the contracts. That email was subsequently sent to Mr Green. The email tells R2O, in relation to pricing calculations that the deposit was not being deducted from the cash price of the car and the calculation was not in conformity with s 32B of the Code. (4) On 31 March 2017, ASIC sent an email to Mr Wills seeking answers to earlier questions put by ASIC and pursuing ASIC's concern about two things. First, R2O's disclosure requirements and second, the annual cost rate of R2O's contracts. That email was also subsequently sent to Mr Green. The email expressly raises non-compliance with s 17 of the Code and again informs R2O of ASIC's view that the credit provider was exceeding the 48% cap. ASIC expressed concerns about the accuracy of R2O's interest calculations. (5) On 12 April 2017, ASIC sent an email to Mr Wills calling for a response to previous concerns ASIC had raised concerning R2O's contracts exceeding the annual cost rate. (6) On 31 May 2017, ASIC sent another email to Mr Wills, copied to Mr Green, observing that ASIC's concerns had not been addressed. Those concerns involved questions raised earlier by ASIC about whether the formula R2O had adopted to calculate charges was in compliance with the Code and whether the methodology used to make calculations failed to comply with the Code. 58 At [193] of the Liability Judgment, the Court made this observation: In the contracts in issue in these proceedings, the annual interest rate is central to the price of the provision by R2O of the credit service. The insertion of the interest rate into the price calculator is one of the essential features of the determination of the amount of the periodic repayment over the term. Thus, the interest rate is one of the essential factors that determines, over the life of the credit facility, the cost of the provision of credit, otherwise understood as the price of the service. 59 At [188] of the Liability Judgment, the Court accepted the expert evidence of Mr Michael Hill who undertook calculations in respect of the credit contracts in issue in the proceeding, including evidence about the correct annual cost rate and annual interest rate for those contracts. Mr Hill identified 140 instances of the annual cost rate in the credit contracts exceeding the 48% cap in contravention of s 32A of the Code: Liability Judgment at [104]; 177 instances of an annual interest rate charge being made or charged to the consumer greater than the rate recited in each case in the relevant consumer's contract: Liability Judgment at [192]; and 187 instances where the annual interest rate actually charged to the consumer was different to the rate recited in the relevant consumer's contract: Liability Judgment at [35]. 60 In relation to Mr Green and Mr Roberts, the Court observed at [423] that they were "at the epicentre of the conduct of [the] business". In this respect, they were the sole directors and shareholders of R2O at the time of the contravening conduct and were the only employees working in the company until September 2017: Liability Judgment at [420]; they were responsible for various versions of R2O's "Operations Manual", the May 2017 version of which recites that the policies and procedures set out therein were the "culmination of the Franchisor's experience in the business over the past combined 50 years (that is, the combined business experience of Mr Green and Mr Roberts)": Liability Judgment at [283]; and they provided the template credit contract and Operations Manual to the franchisees and provided instruction and training, including use of the calculator: Liability Judgment at [421] to [423]. 61 In the Liability Judgment, the Court considered the extent to which Mr Green was at the centre of events involving the conduct of R2O's operations. In the course of reaching a conclusion about that matter, the Court examined Mr Green's evidence about those matters, the documents relevant to his engagement in the affairs of R2O and his evidence given in cross-examination: Liability Judgment at [278]. In particular, the Court extensively considered Mr Green's involvement in the creation and distribution of the price calculators and reached these conclusions. 62 First, the Court did not accept Mr Green's evidence as to the moment in time when he first became aware of the problem with the contracts by reason of s 32A of the Code (that is, contracts exceeding the cap): Liability Judgment at [366] and [383]. 63 Second, the Court did not accept that the failure of his calculator to properly calculate the annual cost rate came, as he said, as a huge surprise to him on 29 March 2018 (when he was examined by ASIC): Liability Judgment at [396]. 64 Third, the Court rejected Mr Green's evidence that he had checked 1,267 contracts and not found anything amiss in the way the relevant interest rates were calculated and inserted into those contracts: Liability Judgment at [396]. 65 Fourth, the Court observed at [407] as follows: The effective interest rate was significantly different. Mr Green knew there were serious concerns consistently being pressed by ASIC about this very matter. I have already explained the respects in which Mr Green approached the creation of his calculators and the formulas within them, with eyes tightly closed, notwithstanding that he had been put on notice of serious concerns by a regulator charged with the responsibility of highlighting the very matter now in question. Moreover, I am reinforced in my view that Mr Green was conscious of these difficulties by the manner in which he approached the checking of the contracts later in time and the issue about the 1,267 contracts. I am satisfied that Mr Green was obfuscating the position as to that matter, as undertaking the matter properly would have been likely to reveal his state of knowledge about non-compliance with the requirements of the Code on this issue. 66 As to Mr Roberts, the Court at [408] observed that he chose to leave the entire question [of the operation of the price calculators and the extent to which they produced outcomes that complied with the Code] to Mr Green. 67 As already mentioned, on 11 September 2020, the Court determined that ASIC was entitled to the relief summarised at [436] of the Liability Judgment involving declarations of contraventions of provisions of the NCCP Act and the ASIC Act by each of the respondents and directed ASIC to submit proposed declarations consistent with the Court's reasons. Annexure A to these reasons sets out the operative content of the declarations and orders made on 1 March 2021. 68 The contraventions by R2O occurred from March 2017 to June 2018. Contraventions in relation to the First Tranche of contracts comprising 142 contracts occurred from March 2017 to August 2017 and in relation to the Second Tranche of contracts comprising 90 contracts, the contraventions occurred in May and June 2018. 69 All 232 contracts the subject of the proceedings included one or more contraventions of either or both of the Code and the ASIC Act as follows. 70 As to the 142 First Tranche contracts: (1) All 142 contracts involve contraventions of s 17(4) of the Code, which provides that the credit contract contain the annual percentage rate. R2O contravened that section because the annual percentage rate contained in the contract was not the actual percentage rate applicable to that contract. (2) All 142 contracts involve contraventions of s 17(5) of the Code, which provides that the credit contract contain the method of calculation of the interest charges payable under the contract and the frequency with which interest charges are to be debited under the contract. R2O's contracts failed to include the method of calculation of the interest charges payable under the credit contract. (3) 108 contracts involve contraventions of s 32A of the Code which provides for a prohibition on a credit provider entering into a credit contract if the annual cost rate exceeds 48%. In the affected contracts, the annual cost rate exceeded 48%. (4) 108 contracts involve contraventions of s 23(1) of the Code which provides for a prohibition on a credit contract imposing a monetary liability on the debtor in respect of an interest charge under the contract that exceeds the annual cost rate of 48%. A contravention of s 23(1) necessarily flows immediately from a contravention of s 32A. (5) 133 contracts involve contraventions of s 12DA of the ASIC Act which provides for a prohibition against a person engaging in conduct in relation to financial services that is misleading or deceptive or likely to mislead or deceive. R2O contravened s 12DA because the interest rate actually charged to the consumer was higher than the rate nominated in the credit contracts in question. (6) 133 contracts involve contraventions of s 12DB(1)(a) of the ASIC Act which contains a prohibition against a person making a false or misleading representation, in connection with the supply or possible supply of financial services, or in connection with the promotion by any means of the supply or use of financial services, that are services of a particular standard, quality, value or grade. R2O contravened this section because the interest rate actually charged to the consumer was higher than the rate nominated in the credit contracts in question. (7) 133 contracts involve contraventions of s 12DB(1)(g) of the ASIC Act which contains a prohibition against a person making a false or misleading representation in relation to the provision of financial services with respect to the price of services. R2O contravened the section because the interest rate actually charged to the consumer was higher than the rate nominated in each of the credit contracts in question. 71 As to the 90 Second Tranche credit contracts, 45 contracts contravened s 17(4) of the Code; all 90 contracts contravened s 17(5) of the Code; 32 contracts contravened s 32A of the Code; 32 contracts contravened s 23(1) of the Code; 44 contracts contravened s 12DA of the ASIC Act; 44 contracts contravened s 12DB(1)(a) of the ASIC Act; and 44 contracts contravened s 12DB(1)(g) of the ASIC Act. 72 The Court found that Mr Green and Mr Roberts were knowingly concerned in the following contraventions by R2O: all of the contraventions concerning the First Tranche contracts; all 90 contraventions of s 17(5) of the Code in relation to the Second Tranche contracts.

The statutory scheme in relation to the making of a penalty order under the Code and the ASIC Act 73 The following observations are concerned with the state of the statutory provisions as they were (not now) at the date of the contraventions in issue, the last of which was on 18 June 2018. 74 Part 6 of the National Credit Code addresses the topic of "Penalties for defaults of credit providers" and Division 1 of Part 6 addresses the topic of "Penalties for breach of key disclosure and other requirements". Section 111(1) and (2) within Division 1 provide that for the purposes of the Division, a "key requirement" in connection with a "credit contract" and a "continuing credit contract" includes any one of the requirements contained in ss 17(4), 17(5), 23(1) and 32A(1) of the Code (among others). 75 Section 17(4) provides that the contract must contain the annual percentage rate and where that rate is determined by referring to a "reference rate" particular information must be set out in the contract (and other information). Section 17(5) requires the contract to set out the "method" of calculation of the interest charges. Section 23(1) is concerned with prohibitions upon imposing claims of monetary liabilities on a debtor, and s 32A(1) provides that a credit provider must not enter into a credit contract if the "annual cost rate" of the contract exceeds 48%. 76 Section 113(1) provides that on an application being made under the Division, the Court must declare whether or not the credit provider has contravened a key requirement of either the credit contract or the continuing credit contract. 77 Section 113(2) provides that the Court "may make an order, in accordance with this Division, requiring the credit provider to pay an amount as a penalty, if it is of the opinion that the credit provider has contravened a key requirement". 78 The persons conferred with standing to apply for an order under Division 1 are a party to the credit contract or a guarantor or ASIC: s 112 of the Code. 79 Section 113(3) provides that in considering the imposition of a penalty, the Court "must have regard primarily" to the "prudential standing of any credit provider concerned" or a relevant subsidiary of such an entity, if either the credit provider or the relevant subsidiary "takes deposits" or is a "borrowing corporation" (within the meaning of the Corporations Act). The last sentence of s 113(3) qualifies that primary consideration in these terms: "However, the court is to have regard to that prudential standing only if the credit provider requests the court to do so". R2O is not a "borrowing corporation" for the purposes of the Corporations Act. It is not clear whether R2O was at the relevant dates a corporation that "takes deposits" for the purposes of s 113(3) although it seems very unlikely. I propose to proceed on the footing that s 113(3) does not apply to R2O. 80 In any event, it should be noted that as to R2O's "prudential standing", R2O is a corporation in liquidation, does not trade and has surrendered its ACL. I am not satisfied that R2O has any favourable prudential standing. 81 Sections 113(4) and 113(5) of the Code are important provisions and they are in these terms: (4) The court, in considering the imposition of a penalty, must have regard to the following: (a) the conduct of the credit provider and debtor before and after the credit contract was entered into; (b) whether the contravention was deliberate or otherwise; (c) the loss or other detriment (if any) suffered by the debtor as a result of the contravention; (d) when the credit provider first became aware, or ought reasonably to have become aware, of the contravention; (e) any systems or procedures of the credit provider to prevent or identify contraventions; (f) whether the contravention could have been prevented by the credit provider; (g) any action taken by the credit provider to remedy the contravention or compensate the debtor or to prevent further contraventions; (h) the time taken to make the application and the nature of the application; (i) any other matter the court considers relevant. (5) The court must, for the purposes of determining an application for an order under this Division or the amount of a penalty, treat a contravention of a key requirement that occurs merely because of another contravention of a key requirement as being a contravention of the same kind. If a provision referred to in section 111 contains several requirements, the court must treat contraventions of more than one of those requirements as a single contravention of the one key requirement for the purposes of determining the amount of a penalty. 82 In making an application under s 113 of the Code, s 119(1) provides that the subject matter of the application may concern one or more credit contracts or all or any class of credit contracts. Section 119(1) is in these terms: 119 General provisions relating to applications by credit providers or ASIC (1) An application for an order by a credit provider or ASIC: (a) may apply to any one or more credit contracts; and (b) may apply to all or any class of credit contracts entered into by the credit provider during a specified period (for example, all credit contracts entered into during a specified period which are affected by a specified contravention). 83 In this case, ASIC's application applies to all 232 credit contracts the subject of the proceedings as described in Table 1 to the orders of 1 March 2021 the subject of the Liability Judgment, but not all of the contracts entered into by R2O. 84 On an application by ASIC, the maximum theoretical penalty that may be imposed under s 113(2) (having regard to s 113(4), s 113(5) and s 119), is determined by s 116 which is in these terms: 116 Penalty if application made by a credit provider or ASIC On application being made by a credit provider or ASIC for an order, the maximum penalty that may be imposed by the court for a contravention of a key requirement relating to a contract affected by the application is an amount calculated so that the total penalty for all contraventions of the requirement in Australia (as disclosed by the credit provider) does not exceed $500,000. 85 As to the maximum penalty, there are four sections of the Code containing key requirements the subject of the contraventions: see Table 1 to the 1 March 2021 orders (ss 17(4), 17(5), 23(1) and 32A(1)). ASIC takes the position that because the contraventions of s 23(1) "flowed inevitably" from contraventions of s 32A, the effect of s 113(5) is that the Court must treat the contraventions of s 23(1) as contraventions of the "same kind" as s 32A with the result that the maximum penalty is not determined as contraventions of four clusters of key requirements but three clusters and therefore the maximum penalty is $1.5m and not $2m for R2O's contraventions of the Code. 86 A further consideration is that s 116 of the Code, as mentioned, contemplates that the maximum penalty for a contravention of a key requirement of a credit contract (affected by an application) is an amount calculated so that the "total penalty" for "all contraventions of the requirement in Australia" does not exceed $500,000. In this case, the application is concerned with a subset of such contracts being the particular 232 contracts in issue. 87 R2O also engaged in contraventions of ss 12DA(1), 12 DB(1)(a) and 12DB(1)(g) of the ASIC Act as a result of having misrepresented the actual interest rates applicable under the relevant contracts. 88 Section 12GBA(1)(a) of the ASIC Act provided at the relevant time that if satisfied that a person has contravened a provision of subdivision C (prohibitions on engaging in unconscionable conduct), a provision of subdivision D, (concerning consumer protection prohibitions), other than, however, s 12DA of that subdivision, or a provision of subdivision GC (substantiation notices), the Court may order the person to pay such pecuniary penalty (in respect of each act or omission) "as the Court determines to be appropriate". In "determining the appropriate penalty, the Court must have regard to all relevant matters" including the matters at s 12GBA(2)(a)-(c), namely: (a) the nature and extent of the act or omission and of any loss or damage suffered as a result of the act or omission; and (b) the circumstances in which the act or omission took place; and (c) whether the person has previously been found by the Court in proceedings under this Subdivision to have engaged in any similar conduct. 89 The contravening conduct of R2O to which a penalty applies under s 12GBA(1)(a) concerned the contraventions of s 12DB(1)(a) and s 12DB(1)(g). Section 12GBA(3) provided, in the period of the contraventions of ss 12DB(1)(a) and 12DB(1)(g), that the maximum number of penalty units for a body corporate was 10,000 penalty units and for an individual, 2000 penalty units. Pursuant to s 4AA of the Crimes Act 1914 (Cth), a penalty unit for contracts entered into prior to 1 July 2017 was $180 and for contracts thereafter, $210. Thus, the maximum penalty for a contravention of either section by a corporation was $1.8m and for an individual $360,000 in the period to 1 July 2017, and for the period thereafter, the maximum penalty for a corporation was $2.1m and for an individual, $420,000. 90 In the present case, there were 126 First Tranche credit contracts entered into prior to 1 July 2017 and 16 First Tranche contracts entered into after 1 July 2017. All of the Second Tranche contracts (90 contracts) were entered into after 1 July 2017. 91 Therefore, the theoretical maximum penalty for a contravention by R2O of each of s 12DB(1)(a) and s 12DB(1)(g) in respect of 118 contraventions concerning contracts prior to 1 July 2017 is $212,400,000 (118 multiplied by $1.8m) and in relation to the 15 contraventions concerning First Tranche contracts entered into after 1 July 2017, the theoretical maximum penalty is $31,500,000 (15 multiplied by $2.1m). As to all of the Second Tranche contracts, there are 44 contraventions resulting in a maximum penalty of $92,400,000 (44 multiplied by $2.1m). 92 As to an individual, the maximum penalty for contraventions of each section concerning the First Tranche contracts entered into prior to 1 July 2017 is $48,780,000 made up of 118 contraventions of First Tranche contracts prior to 1 July 2017 (118 multiplied by $360,000, equalling $42.480m) and 15 First Tranche contracts after 1 July 2017 (15 multiplied by $420,000, equalling $6.300m): $48.780m in all. 93 As to the number of First Tranche contraventions of each section, see Table 1, Column E to the orders of 1 March 2021 cross-referenced to the date of the contract. In the Liability Judgment, the Court determined that neither Mr Green nor Mr Roberts were knowingly concerned in R2O's contraventions of either section in relation to the Second Tranche contracts and therefore it is not necessary to calculate the maximum penalty that would apply to an individual concerning those contracts.

The principles to be applied in determining the amount of the penalty to be imposed 94 The starting point is the NCCP Act and the Code. The Code is Schedule 1 to the NCCP Act. All of the following comments concern the provisions of the NCCP Act and the Code as they stood in the period of the contraventions and not otherwise, and to the extent that references are made in the present tense, they are references to provisions in the relevant period. Some references continue to be relevant to the legislative regime as it stands today. 95 The NCCP Act and the Code are beneficial statutory instruments which impose important protections for consumers dealing with "credit providers" engaging in "credit activity". The protections include a requirement that a credit provider seeking to engage in credit activity and other related activities must hold an Australian credit licence: s 29, NCCP Act. The conditions governing applications for such a licence, what must be made out, and supervision of licences are extensive: Part 2-2, NCCP Act. The definition of "credit activity" is broad: s 6. The obligations of licensees are extensive: Division 5, Part 2-2. A licensee may authorise a person to act as the licensee's "credit representative": s 64. As to the extensive provisions governing the appointment of credit representatives and the corresponding obligations of licensees, see Part 2-3 of the NCCP Act. As to the general rules governing licensees that apply to all credit providers under "credit contracts" see Part 3-2 of Chapter 3 (which extensively addresses the topic of "Responsible lending conduct", ss 111-164); and s 4 of the Code. The remedies in relation to contraventions of the civil penalty provisions are contained in Part 4-1 of the NCCP Act. All of the provisions of the NCCP Act leading up to Chapter 4 addressing remedies have the purpose of establishing norms or standards of conduct on the part of persons engaging in credit activity and related activities some of which might give rise to a credit contract or the "provision of credit" for the purposes of s 5 of the Code. 96 All remedial provisions are beneficial by their very nature. 97 The Code might fairly be described as highly prescriptive. Again, the Code prescribes irreducible minimum standards and norms of conduct to be discharged by those licensed entities seeking to engage in the provision of credit (s 3 and s 5 of the Code) and activities falling within ss 7 to 13 and 13A of the Code. Immediately relevant for present purposes, Part 2 of the Code concerns credit contracts and the requirements of ss 17(4), 17(5), 23(1) and 32A. Each of these provisions of Part 2 (and many other Part 2 provisions (eight others)) are "key requirements" in connection with a credit contract. They are beneficial protective standards for and of consumers in their dealings with credit providers. 98 Sections 12DA(1) and 12DB(1) of the ASIC Act (relevantly here, ss 12DB(1)(a) and 12DB(1)(g) containing prohibitions on engaging in trade or commerce in misleading or deceptive conduct in relation to financial services) are well understood as establishing important beneficial and normative standards. 99 Turning to the Code specifically, it confers, as discussed, power on the Court to order a credit provider to pay an amount as a penalty concerning contraventions of a "key requirement" (liability having been established for the purposes of s 113(2)), having regard to the prudential standing factor (s 113(3), if engaged), and all of the nine factors at s 113(4) taking into account the maximum cap in s 116 and also the s 119 considerations. 100 Section 12GBA(1) of the ASIC Act confers power, once engaged, on the Court to order a person to pay such penalty "as the Court determines to be appropriate" having regard to the three factors at s 12GBA(2) and the maximum cap at s 12GBA(3). 101 The power to impose a pecuniary penalty under s 113(2) of the Code and s 12GBA(1) of the ASIC Act represent a power to impose sanctions upon a person for contraventions of the normative and beneficial standards imposed on the relevant person by the particular provisions establishing those norms and standards. The power must be exercised according to the statutory factors, the jurisprudence and the object and purpose of the provisions. In exercising the power according to those three considerations, the Court takes into account notions of "deterrence" both specifically in relation to the contravenor and generally as to others. 102 The general principles to be applied are these. 103 The statutory function of s 113(2) of the Code and s 12GBA(1) of the ASIC Act is to secure compliance with the relevant provisions of the regime. Importantly, "unlike criminal sentences, civil penalties are imposed primarily, if not solely, for the purpose of deterrence": Australian Building and Construction Commission v Pattinson [2022] HCA 13 ("ABCC v Pattinson"), the majority (Kiefel CJ, Gageler, Keane, Gordon, Steward and Gleeson JJ) at [15]. The "purpose" of a civil penalty "is primarily if not wholly protective in promoting the public interest in compliance" (ABCC v Pattinson, the majority at [15] affirming the statement of principle in The Commonwealth v Director, Fair Work Building Industry Inspectorate (2015) 258 CLR 482 ("The Commonwealth v DFWBI") by the majority, French CJ, Kiefel, Bell, Nettle and Gordon JJ at [55]). The "principle" and "probably the only" object of penalties imposed by s 113(2) of the Code and s 12GBA(1) of the ASIC Act (like s 76 of what was the Trade Practices Act 1974 (Cth)) is "to attempt to put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene" [emphasis added], the relevant provisions: Trade Practices Commission v CSR Ltd [1991] ATPR 41-076 at 52,152 ("TPC v CSR"), French J, approved by the majority in The Commonwealth v DFWBI at [55] and approved by the majority in ABCC v Pattinson at [15]. 104 Similarly, the majority in ABCC v Pattinson at [16] affirmed that the majority in The Commonwealth v DFWBI had established that "deterrence is the 'principal and indeed the only object' of the imposition of a civil penalty" and noted at [17] that the majority in Australian Competition and Consumer Commission v TPG Internet Pty Ltd (2013) 250 CLR 640 at 659 [66] had accepted that a civil penalty "must be fixed with a view to ensuring that the penalty is not such as to be regarded by [the] offender or others as an acceptable cost of doing business": see also Australian Competition and Consumer Commission v Reckitt Benckiser (Australia) Pty Ltd (2016) 340 ALR 25 at [151]. 105 A further matter of importance is this. In considering the scope of the power under s 546 of the Fair Work Act 2009 (Cth) to impose civil penalties in respect of contraventions of the civil remedy provisions of that Act, the majority in ABCC v Pattinson said this at [10] which needs to be kept in mind when considering the exercise of power under s 113(2) of the Code and s 12GBA(1) of the ASIC Act: 10 The Full Court's critical error was that it was distracted by a concern, drawn from the criminal law, that a penalty must be proportionate to the seriousness of the conduct that constituted the contravention. The power conferred by s 546 of the Act is not subject to constraints drawn from the criminal law and there is no place for a "notion of proportionality", in the sense in which the Full Court used that term, in a civil penalty regime. Further, and relatedly, their Honours were misled by the view that the Act required that the maximum penalty be reserved for only the most serious examples of the offending comprehended by s 349(1), and that this principle could prevent the court from imposing the maximum penalty even though a penalty in that amount might reasonably be considered to be necessary to deter future contraventions of a like kind. Nothing in the text, context or purpose of s 546 requires that the maximum penalty be reserved for the most serious examples of misconduct within s 349(1). What is required is that there be "some reasonable relationship between the theoretical maximum and the final penalty imposed". That relationship is established where the maximum penalty does not exceed what is reasonably necessary to achieve the purpose of s 546: the deterrence of future contraventions of a like kind by the contravenor and by others. [emphasis added; citations omitted] 106 As mentioned, s 113(4) of the Code sets out nine factors the Court must take into account and s 12GBA(2) sets out three factors. In assessing the penalty to be imposed on R2O (for the assumed purpose described at [26] of these reasons), I have had regard to all of the s 113(4) and s 12GBA(2) factors respectively. 107 In TPC v CSR, French J at 52,152 to 52,153, identified nine factors to be taken into account in determining the assessment of a penalty of appropriate deterrent value for the purposes of the TPA. In NW Frozen Foods v Australian Competition and Consumer Commission (1996) 71 FCR 285 at 292-295 ("NW Frozen Foods"), the Court noted three further matters to be taken into account. Of course, s 113(4) and s 12GBA(2) set out mandatory statutory factors to be taken into account. As to the TPC v CSR and NW Frozen Foods factors, the majority in ABCC v Pattinson at [19] reaffirmed the proposition that these factors are not a rigid catalogue of matters for attention or some sort of "legal checklist". Nevertheless, the factors remain useful but in no sense are they determinative of the ultimate statutory question, but may help to inform the answer to that question. As to the role of deterrence, both specific and general, in circumstances where the contravening entity is in liquidation, see [184]-[190] (and also the assumption at [26]) of these reasons. 108 The question for the Court under s 12GBA(1) is to determine an "appropriate" penalty "in the circumstances of the particular case" and under s 113(2), a discretion is conferred on the Court to "make an order (in accordance with Division 1) requiring a credit provider to pay an amount as a penalty" which also necessarily takes into account the circumstances of the particular case.

The application of the penalty factors to the circumstances of the case 109 Mr Roberts, by his counsel, has made submissions relevant to his own particular circumstances and I will turn to those matters later in these reasons. Mr Green challenges the gravity of the contraventions as contended for by ASIC and I will also turn to Mr Green's submissions later in these reasons: see [49] of these reasons. I propose to now identify the contentions of ASIC in relation to the application of the penalty factors to the circumstances of the case.

The Code contraventions 110 The "key requirements" set out in s 17(4) and s 17(5) of the Code each impose separate requirements. Each piece of information serves a distinct purpose in enabling consumers to assess the value of the credit contract compared with other credit contracts so as to decide whether or not to enter into the credit contract at all: Make It Mine Finance Pty Ltd, in the matter of Make It Mine Finance Pty Ltd (No 2) [2015] FCA 1255 ("ASIC v Make It Mine"), Beach J at [38]. Importantly, s 17(4), as discussed, requires disclosure of the annual percentage rate or rates of interest and ensures that the consumer can easily and quickly compare different rates of interest available to them in the marketplace. Section 17(5) requires disclosure of the method and calculation of interest and its frequency of calculation and enables consumers to quickly and easily compare offerings in the marketplace and to be fully informed of the consequences of a decision on the part of the consumer to enter into a credit contract. 111 The statutory regime provides that it is a breach of the Code to fail to include any such key requirement in the credit contract: s 17. Each obligation plays its own important role in the statutory scheme and the Parliament has chosen to establish these features as separate key requirements. 112 Section 32A, as earlier mentioned, provides that a credit provider must not enter into a credit contract if the annual cost rate of the contract exceeds 48%. The effect of the section is to provide a regulatory maximum cap that can be charged as an annual cost rate under credit contracts. As described earlier, the provision is an important beneficial protective mechanism within the regime, particularly for consumers who may not be able to deconstruct the elements of a credit contract so as to identify features with the transparency contemplated by these "key requirements". 113 Section 23(1)(c) of the Code provides that a credit contract (other than a small amount credit contract) must not impose a monetary liability on the debtor in respect of an interest charge under the contract exceeding the amount that may be charged consistently with the Code. In this case, there are 140 examples in which R2O has contravened s 32A by charging an annual cost rate greater than 48% which impose a relevant monetary liability on the consumer under the contract. 114 I now turn to the various statutory factors under the Code.

The conduct of R2O and the debtor before and after the credit contract was entered into: the s 113(4)(a) factor 115 This factor involves consideration of the seriousness with which the credit provider took its obligations under the Code and how quickly it acted to fix errors. ASIC's contention is that R2O did not take its compliance with the Code seriously, until well after ASIC commenced its investigations and the many communications from ASIC raising concerns with Mr Green and Mr Roberts about R2O's compliance with the requirements of the Code. The particular problems with the price calculators were fundamental. The consequences (including over-charging consumers) were very serious. As a result, ASIC alerted R2O to the problems on numerous occasions in very clear terms. These matters were raised by ASIC in the meeting on 9 March 2017 and in emails from ASIC on 16 March 2017 and 31 March 2017. 116 ASIC contends that despite the gravity of the matters raised with R2O, Mr Green and Mr Roberts failed to promptly address those problems. 117 ASIC notes that R2O sought assistance about these matters from external advisers. They were Mr Wills of QED and Mr Latham of MinterEllison. However, ASIC contends that R2O's engagement of those external advisers was "poorly managed"; that the chronology of the communications with those advisers demonstrates a "lack of urgency" in addressing ASIC's concerns; and that the involvement of the external advisers was "only very belatedly useful" in producing a calculator that complied with the statutory requirements under the Code imposed on R2O by the key requirements in issue in the proceedings. 118 ASIC observes that Mr Wills had, in August 2017, provided R2O with a calculator that utilised a formula that complied with the statutory requirements. It was not until eight or nine months later in April or May 2018 that R2O issued its franchisees with a price calculator that used the statutory formula. 119 ASIC observes that the failure to promptly address those problems of the calculator when they were raised by ASIC meant that R2O continued to enter into credit contracts with consumers that contravened the Code, including by charging interest at a rate greater than the maximum of 48%. Some of the conduct of each of Mr Green and Mr Roberts in failing to address ASIC's concerns have been described earlier in these reasons and their conduct is addressed extensively in the Liability Judgment. 120 ASIC also submits that even after R2O had sent its franchisees correct price calculators, some franchisees (R2O's credit representatives) continued to write contracts in contravention of s 17(4), s 32A and s 23(1) of the Code by including incorrect annual interest rates in the credit contract. 121 Also, the contravention of s 17(5) continued to be present in all credit contracts even after the errors associated with the price calculator were ultimately corrected by R2O. This failure to disclose, on the face of the credit contract, the method of calculation of interest charges payable under the contract was unrelated to the problems arising as a result of R2O's use of the incorrect formula adopted in the price calculator. 122 ASIC further submits that, indeed, concerns about the disclosure requirements in R2O's template contracts had been raised by ASIC with R2O by at least 31 March 2017. An email from ASIC of 31 March 2017 stated that "despite previously raising the [s 17] disclosure issue with your clients, we note the obligation is still not being fully met". In an email of 6 April 2017, Mr Wills (responding to ASIC on behalf of R2O) stated that the disclosure requirement in respect of s 17(5) was "being assessed by Steven Latham of MinterEllison lawyers". On 12 April 2017, ASIC suggested that, given the time taken to ensure compliance (of the credit contracts) with the disclosure requirements of the Code, R2O "may need to consider ceasing entering into new contracts until the review process is completed [by Mr Latham for the purposes of s 17(5)]". ASIC observes that despite being alerted to these matters in early 2017, the contravention of s 17(5) continued for all of the First Tranche and Second Tranche contracts, that is, until at least July 2018. 123 ASIC contends that the conduct of each of R2O, Mr Green and Mr Roberts in relation to this factor weighs in favour of a greater civil penalty.

Whether the contravention was deliberate or otherwise: the s 113(4)(b) factor 124 ASIC contends that while R2O's contraventions of the Code "may not [have been] deliberate in the sense that it sought to breach the Code", R2O's failure to take action in circumstances where Mr Green and Mr Roberts had been put on notice of ASIC's concerns about R2O's credit contracts not complying with obligations under the Code, is an "extreme example" of a credit provider failing to "acquit" its statutory obligations. As an element of this contention, ASIC notes the Court's findings in the Liability Judgment rejecting Mr Green's evidence that he had undertaken a check of 1,267 contracts. ASIC contends that it is important to note that almost all of the affected contracts were entered into well after ASIC had expressed its concern about R2O entering into contracts which incorporated charges greater than it was entitled to impose and adopt. ASIC notes that Mr Green and Mr Roberts were both in the teleconference with ASIC on 9 March 2017 with the minutes of the meeting recording ASIC officers making these statements: … In addition, further serious concerns have been identified revolving around … the calculation of charges and whether they are within the [statutory] cap. In our view the identified concerns are wide and serious enough to consider [elevating] this matter to Enforcement to take action against R2O. … The purpose of this meeting is to seek R2O's response to the concerns raised and to see if R2O is willing to acknowledge ASIC's concerns and take steps to address those concerns. Pending R2O taking steps, ASIC is of the view that R2O should consider ceasing its operations. … … Another issue of concern is whether R2O's charges exceed the [statutory] cap. We have information to suggest it does and if that is the case then another factor to consider is remediation for those who paid in excess [of the cap]. 125 In the Liability Judgment at [382], the Court described Mr Green as having "eyes tightly closed to the fundamental obligations set out in s 32A and s 32B" and, at [407], that Mr Green "approached the creation of his calculators and the formulas within them, with eyes tightly closed, notwithstanding that he has been put on notice of serious concerns by a regulator charged with the responsibility of highlighting the very matter now in question". 126 ASIC contends that R2O's failure to have proper regard to its statutory obligations despite having been put on specific notice by ASIC of the Regulator's concerns as to contravening conduct, is a factor that weighs heavily in favour of a greater penalty.

The loss or other detriment (if any) suffered by the debtor as a result of the contravention: the s 113(4)(c) factor 127 ASIC contends that consumers suffered "actual loss and detriment" in entering into credit contracts with R2O for these three principal reasons. 128 First, consumers were denied the opportunity to accurately compare R2O's credit products with those of its competitors. 129 Second, at least 20 borrowers actually paid more on their credit contracts than they were required to pay under the contract. 130 Third, most of the consumers (177 in number) in fact made higher weekly repayments than they would have been required to pay if the weekly repayment amount had been calculated with reference to the interest rate stated in the credit contract. 131 The expert evidence of Mr Hill revealed a number of features relevant to this factor. 132 First, of the 232 consumers who entered into credit contracts with R2O, 140 contracts exceeded the statutory maximum annual cost rate of 48% (being 108 credit contracts in respect of the First Tranche and 32 contracts in respect of the Second Tranche). The amounts R2O charged those 140 consumers under those contracts that exceeded the 48% rate in aggregate totalled $196,576.07 (being $169,661.79 in respect of the First Tranche and $26,914.28 in respect of the Second Tranche). 133 Second, while it is true that in 14 contracts the amount the consumer was charged was in fact less than the amount charged using the annual percentage rate recited in the credit contract (being nine examples in the First Tranche and five in the Second Tranche), it nevertheless remains the position that in 177 cases the repayment the consumer was in fact charged pursuant to the contract was higher than the amount that ought to have been charged (being 133 contracts in the First Tranche and 44 in the Second Tranche). 134 Third, the amount R2O charged those 177 consumers under their contracts that was higher than the amount that ought to have been charged, was in the aggregate, $363,542.37 or on average $2,053.91 per contract ($363,542.37 divided by 177). 135 Fourth, in respect of all 232 consumers (that is, both in respect of those consumers who were charged more, and those who were charged less, than they should have been charged using the correct interest rate), R2O charged consumers, pursuant to their credit contracts, in aggregate $354,162.26 more than they should have been charged, or on average, $1,526.56 as follows: an amount of $296,883.51 in respect of 142 First Tranche contracts representing an amount on average of $2,090.72 per contract; an amount of $57,278.75 in respect of 90 Second Tranche contracts representing an amount on average of $636.43 per contract. 136 ASIC observes that R2O and Mr Green contended, during the liability trial, that there was no evidence that any contravening conduct resulted in customers suffering any loss or damage. Their contention was that while only relevant to the question of sanction, the dollar amounts calculated by Mr Hill in his various reports were in a sense only theoretical as they were based upon the sums stated in the contracts whereas the actual amounts charged to customers were in many cases significantly less: Liability Judge at [58]. In Mr Green's affidavit at paras 59 to 69, he said these things. 137 First, at [62], R2O's policy was to only accept customer payments by direct deposit via Ezidebit, a third party non-bank direct debit automated payment provider. 138 Second, Mr Green exhibited Ezidebit records to his affidavit which he says he retrieved for the 232 customers the subject of the proceedings, listed at [68] of his affidavit. 139 Third, Mr Green listed a number of consumers in respect of which he had reviewed their Ezidebit records and contended that there is no record of any payments having been received by R2O via Ezidebit, which led him to conclude that apart from an initial deposit, no payments were received by R2O from those consumers: see [65] and [66] of Mr Green's affidavit. 140 Fourth, Mr Green said that he had prepared a spreadsheet based on the Ezidebit records which sought to identify the number of payments received from each of the customer/consumers referred to in Mr Hill's report and, according to Mr Green, the spreadsheet indicates that many of the contracts did not go full term and that the amounts actually received by R2O were less than the total contract price calculated in Mr Hill's report: see [69] of the affidavit. 141 As to these matters, ASIC makes these contentions. 142 First, the Ezidebit records do not accurately reflect all repayments made by consumers to R2O on their contracts. Mr Green accepted in cross-examination that R2O accepted customer payments by means or platforms other than direct deposit via Ezidebit, including cash payments. In the evidence before the Court at the Liability Hearing there were numerous examples of consumers making repayments under their credit contracts other than via Ezidebit and the evidence of those contracts was put to Mr Green. In the result, ASIC contends that Mr Green's calculations in his spreadsheet at "PG-16" to his affidavit ought not be accepted as accurate reflecting the amounts in fact paid by consumers in respect of their credit contracts. 143 Second, ASIC says that even on the basis of the calculations in Mr Green's spreadsheet at "PG-16", 20 consumers paid more than they ought to have paid, the total of their combined overpayments being $29,584.99. ASIC observes that Ms Leisfield, a solicitor employed by ASIC, has brought into existence a table that brings together the relevant calculations by Mr Hill and those set out in Mr Green's affidavit, in order to demonstrate a number of matters relating to the adverse impact on consumers of R2O's contravening conduct. The amounts overpaid by some individual consumers were as much as $5,938.00: see the details in relation to the contract entered into on 16 June 2017 between R2O and Samantha Stockham, Leisfield affidavit at [12], Annexure "JKL-7". 144 Third, the question of remediation was raised by ASIC with R2O as early as 9 March 2017 in the teleconference attended by Mr Green and Mr Roberts earlier mentioned. The minutes of that meeting record this observation by officers of ASIC: "Another issue of concern is whether R2O's charges exceed the cap. We have information to suggest it does and if that is the case then another factor to consider is remediation for those who paid in excess [of the cap]". ASIC observes that R2O has not adduced any evidence that it has repaid those 20 consumers the amounts representing their overpayments. Nor has R2O adduced any evidence that it has undertaken a review of the entirety of its customer base to ascertain how many other customers have in fact paid more than they were required to pay, and having identified those customers, taken steps to reimburse to them the overpayments. 145 Fourth, it remains the fact that 177 consumers have in fact made higher weekly repayments than they would have been required to pay if the weekly repayment amount had been calculated with reference to the interest rate actually stated in the contract. ASIC observes that the circumstance that those consumers were paying more each week than they needed to pay is a significant matter. ASIC contends that many consumers who entered into credit contracts with R2O to buy second-hand cars from R2O franchisees were likely to experience budgeting pressures for day-to-day living expenses. The circumstance that those consumers were being required to make greater weekly credit contract repayments than they needed to pay would inevitably increase a consumer's "financial strain". ASIC contends that as the table annexed to Ms Leisfield's affidavit shows, the difference between the scheduled weekly repayment amount (that is, the amount actually paid each week) and the amount that should have been paid each week using the interest rate in the contract, was as much as $64.14 (each week). 146 Finally, ASIC also contends that the breaches of the key requirements also involved a degree of detriment to debtors as the conduct did not enable a proper consideration of the cost of the credit contract, or allow a genuine comparison between R2O's products and those of its competitors. 147 As to the matters related to this factor, ASIC contends that the considerations weigh in favour of a greater civil penalty.

When the credit provider first became aware, or ought reasonably to have become aware of the contraventions: the s 113(4)(d) factor 148 Having regard to the above discussion, the events suggest that R2O ought to have been aware of the contraventions of the Code by at least as early as 9 March 2017 when the teleconference took place between officers of ASIC, Mr Green, Mr Roberts and Mr Wills. As already mentioned, the minutes of the meeting record the serious concerns expressed by ASIC in relation to the calculation of charges and whether the charges imposed on the consumer under the credit contract were within the 48% cap. However, ASIC contends that even before 9 March 2017, ASIC officers had engaged with R2O in relation to concerns about compliance with the Code. ASIC contends that had R2O undertaken a comprehensive compliance audit at that time, the audit may have detected practices which failed to comply with the Code.

Any systems or procedures of the credit provider to prevent or identify contraventions: the s 113(4)(e) factor 149 ASIC contends that R2O has not identified any compliance system or procedures put in place to prevent or identify contraventions in the period of the contravening conduct. It contends that there is no evidence before the Court as to any remediation program carried out by R2O concerning consumers who have been overcharged. ASIC notes that R2O surrendered its ACL on 3 March 2020 and thus purports to no longer be engaging in credit activity at all.

Whether the contraventions could have been prevented by the credit provider: the s 113(4)(f) factor 150 This factor is directed to circumstances where the credit provider has some appreciation or ought to have been aware of contraventions at the time they were occurring and whether R2O ought to have taken steps to prevent the contraventions occurring: Macquarie Credit Union Ltd v Director-General of Fair Trading (1998) ASC 155-014. ASIC contends that in circumstances where it had put R2O on notice of concerns about R2O charging a greater level of interest than it was entitled to charge, had R2O responded swiftly, diligently and competently to ASIC's concerns, most (and perhaps all) of the contraventions could have been prevented.

Any action taken by the credit provider to remedy the contraventions or compensate the debtor or to prevent further contraventions: the s 113(4)(g) factor 151 ASIC observes that after finally addressing the failures in its price calculator, and commencing on 1 June 2018 to use a calculator that utilised the statutory formula, Mr Green sent an email to the franchisees attaching a Loan Difference Calculator and on 7 June 2018 he sent the franchisees the text of a letter or email to be sent to current customers advising the customer of any adjustment to their contract: Liability Judgment at [394]-[395]. Mr Green's email to the franchisees was in these terms: Hi All, this is the template to use (cut and paste) to send to your customers when you have amended their contracts. This is the only letter we authorise to be sent. You must cc … admin@rent2owncars.com.au into every email sent. Dear Rent 2 Own Customer Due to recent changes in the finance industry Rent 2 Own has done a full audit of current contracts to bring in up to date recommendations by government departments. You are receiving this email as a courtesy to let you know that your current contract will have reduced term or payment amount for the remainder of the contract. Your new term finish date is Your new payment amount is $ (delete which is not applicable). … 152 ASIC contends that the text of the letter or email Mr Green instructed franchisees to send to customers did not accurately reflect the reasons the letter needed to be sent. It was untrue that there had been any relevant "recent changes in the finance industry" or that the correspondence was prompted by "recommendations by government departments". 153 The letter was necessary simply because R2O had contravened the law. 154 Again, ASIC emphasises that R2O has not adduced any evidence that it has taken any or adequate steps to compensate any debtors. ASIC also submits that R2O has not adduced any evidence that despite surrendering its ACL, it immediately ceased to engage in any further "credit activity", and in the event that it continued to engage in any credit activity, whether it took any action to prevent further contraventions, especially in relation to obligations arising under existing credit contracts entered into prior to the cancellation of the ACL.

The time taken to make the application and the nature of the application: the s 113(4)(h) factor 155 The originating application was filed on 29 August 2018. ASIC observes that, relevantly, it was ASIC that brought the application not R2O. As discussed above, ASIC had notified R2O of its concerns about the issues dealt with in these proceedings as early as 9 March 2017. ASIC was required to expend significant costs in dealing with the various issues including obtaining expert reports. It contends that had R2O acted promptly and competently, after ASIC first put R2O on notice of its concerns, R2O would have been in a position to identify the contraventions itself and deal with the matter properly.

Other matters: the s 113(4)(i) factor 156 In taking into account the "other matters" factor, ASIC contends that the Court may consider it appropriate to take into account factors relevant to the consideration of civil penalties in other statutory contexts such as the factors identified in TPC v CSR and NW Frozen Foods. ASIC also contends that it may be relevant, under this factor, to also have regard to the circumstance that R2O has engaged in contraventions of the ASIC Act. 157 As to the ASIC Act, it is necessary to deal with those matters as separate considerations.

The considerations to be taken into account in relation to the contraventions of the ASIC Act 158 The following matters are the factors required to be taken into account for the purposes of s 12GBA(2)(a) to (c).

The nature and extent of the act or omission and of any loss or damage suffered as a result of the act or omission: s 12GBA(2)(a) factor 159 R2O contravened each of ss 12DB(1)(a) and 12DB(1)(g) on 177 occasions. 160 It did so by representing, in its credit contracts, that the applicable annual interest rate was less than, in fact, it was. 161 ASIC contends that the contravening conduct was serious. 162 At [193] of the Liability Judgment, the Court emphasised the centrality of the annual percentage rate to the credit contract in the following terms: In the contracts in issue in these proceedings, the annual interest rate is central to the price of the provision by R2O of the credit service. The insertion of the interest rate into the price calculator is one of the essential features of the determination of the amount of the periodic repayment over the term. Thus, the interest rate is one of the essential factors that determines, over the life of the credit facility, the cost of the provision of credit, otherwise understood as the price of the service. 163 As to the contraventions of s 12DB(1)(a), the Court said this in the Liability Judgment at [208] and [209]: 208 A representation that a credit provider provides credit for the purchase of a used car on the critically important matter of an interest rate of 45% (or some other particular figure) as the cost of the credit over the period of the credit contract when in fact the rate actually charged was, from the very outset of the contract, going to be significantly higher than the nominated figure, is a matter that goes to price, but also to the very quality of the financial service. 209 A credit provider that actually charges more than it has told the credit customer it will charge (and bound itself to charge), is engaged in conduct of making a false or misleading representation that the financial services are of a particular quality, whatever other characterisation the representation might bear. The matter as to "quality" is consistency with the promise as to the rate. The representation also goes to the value of the financial services, as charging a higher rate of interest than that provided for by the contract is conduct in connection with the supply of the services that suggest that the services have a value to the hirer/debtor that they do not have, due to the higher rate of actual charge. 164 As to the loss and damage suffered by the consumers, the details of those matters have already been set out in these reasons. 165 ASIC also observes that the case in relation to contravention was not conducted on the footing that the 177 consumers would not have entered into the contracts but for the contravening conduct. ASIC observes that this is not the point of the proceedings as consumers are not seeking damages as a function of reliance. Rather, the question is the penalty to be imposed in respect of the contravening conduct and one aspect of that matter is the loss and damage suffered by the consumers concerning the scope and operation of the contract.

The circumstances in which the act or omission took place: the s 12GBA(2)(b) factor 166 The relevant circumstances in which the offending conduct took place have already been described in these reasons. It is not necessary to repeat those circumstances here.

Whether the person has previously been found by the Court in proceedings under this subdivision to have engaged in any similar conduct: the s 12GBA(2)(c) factor 167 ASIC accepts that R2O has not previously been found by the Court to have engaged in any similar conduct. 168 There are other civil penalty factors as discussed in TPC v CSR and NW Frozen Foods as described earlier and the High Court has, as also mentioned earlier, affirmed the notion that these factors are not to be treated as a legal checklist or distract attention from the central question to be determined, as described at [108] of these reasons: see [94]-[108] of these reasons. The factors may assist in informing the question but in no sense are they to displace addressing the central question. I will briefly address the factors.

The TPC v CSR and NW Frozen Foods factors 169 The first factor is the nature and extent of the contravening conduct. That matter has been addressed extensively in these reasons and there is no need to repeat any aspect of it here. The second factor is the amount of loss or damage caused and that matter has also been addressed. The third factor is the circumstances in which the conduct took place and that matter has also been addressed. 170 The fourth factor is the "size of the corporation". As to that matter, these things should be noted. As an indication of the scale of the business, R2O entered into 5,930 credit contracts in the period 1 July 2012 to 26 July 2018 and as at 19 April 2018, R2O had 2,239 credit contracts on foot. R2O operated its business through a network of franchise agreements and as at 17 July 2017 and 26 July 2018, there were 21 franchisees operating in Queensland, New South Wales, Victoria, South Australia and Western Australia. 171 The fifth factor is the deliberateness of the contravention and the period over which it extended. This matter has also already been addressed. 172 The sixth factor is whether the contraventions arose out of the conduct of senior management or at a lower level. In this case, the contraventions arose as a result of the acts or omissions of R2O's two directors as the guiding minds of the company. 173 The seventh factor is whether R2O has a corporate culture conducive to compliance with the Code and the ASIC Act. As to this matter, ASIC contends that R2O's corporate culture was created and sustained by its two directors, Mr Green and Mr Roberts. It contends that the culture was "woefully incapable of ensuring compliance with the relevant provisions of the NCCP Act, Code and ASIC Act". ASIC also contends that even once R2O commenced using a price calculator that adopted a method of interest calculation that complied with s 32B of the Code, and sent the calculator to franchisees for their use, some of those franchisees continued to either fail to use the correct calculator or misuse the calculator. 174 ASIC contends that the Second Tranche of contracts demonstrates that R2O continued to contravene both the Code and the ASIC Act despite the flaw in the calculator being corrected. 175 ASIC contends that these outcomes demonstrate the "gross inadequacies of [R2O's] compliance culture". 176 The eighth factor is cooperation with the Regulator and as to that matter, ASIC makes these submissions. The nature and quality of R2O's interactions with ASIC between 2016 and 2018 is properly characterised as a "serious failure to respond promptly, and competently, to ASIC's concerns". ASIC contends that it made numerous attempts to seek to have R2O engage with its concerns. It contends that these failures weigh in favour of a greater penalty. ASIC notes that it filed its originating application and concise statement on 27 August 2018 (and an amended concise statement on 19 February 2019). It notes that the respondents filed a response to the concise statement on 7 November 2018 and an amended response to the amended concise statement on 4 March 2019. ASIC notes that the respondents denied any contraventions of the Code or the ASIC Act. 177 ASIC notes that prior to trial, Mr Roberts elected not to contest any of the matters asserted by ASIC in its amended concise statement and elected not to participate in the trial. Mr Roberts adopted the position that he would submit to any order of the Court in the proceedings but wanted to be heard on the question of costs. 178 As to Mr Green, ASIC notes that Mr Green conceded that if the Code applied to the credit contracts in issue, the evidence supported the conclusion that he was knowingly concerned in R2O's contraventions of s 17(5) of the Code, but otherwise he did not concede that he was knowingly concerned in any other contraventions by R2O. 179 The ninth factor is "similar conduct" by R2O in the past and, as mentioned, ASIC accepts that R2O has not been found by a Court to have engaged in other similar contraventions in the past. 180 The tenth factor is the financial position of the company. As to R2O's financial size and position, ASIC notes these matters. 181 First, R2O's income included fees paid to it by franchisees, which between 1 July 2012 and 26 July 2018, amounted to $765,600.00. 182 Second, in addition to those fees, the franchisees paid a "Continuing Franchise Fee" of $330.00 per credit contract per month. 183 Third, R2O's Financial Report for 2017 gives an indication of its financial position at the time of the Report. R2O's gross profit from trading activities was $900,226.00. R2O's profit before income tax was $236,942.00 and its after tax profit was $165,538.00. Included among its expenses were management fees of $200,000.00. It paid a dividend of $100,000.00 in the 2017 financial year. Its retained earnings at the end of that financial year were $253,814.00. 184 As to specific deterrence, ASIC observes that R2O has surrendered its ACL. ASIC contends that Mr Green and Mr Roberts may not currently be engaged in a business of providing consumer credit. Aspects of their current activities are discussed later in these reasons. ASIC also observes that although Mr Green and Mr Roberts may not currently be engaging in Code regulated credit activity, that is not to say that they will not seek to return to providing or exercising decision-making in relation to regulated consumer credit products in the future including such activity directed to consumers within the same demographic cohort as R2O's customers. ASIC contends that notwithstanding all of those considerations, it remains appropriate, in principle, to impose a pecuniary penalty upon a company in liquidation so as to demonstrate the Court's disapproval of the conduct as a measure of the seriousness of the contraventions as found in the Liability Judgment, having regard to the evidence adduced in the penalty hearing. The Court proposes to indicate what would have been an appropriate penalty but for the deregistration of R2O. 185 As to specific deterrence, R2O is in liquidation. Leave has been given to proceed against the company in liquidation. However, the company is now deregistered as from 30 September 2021 and no pecuniary penalty can be imposed on a company that has ceased to exist. 186 Specific deterrence is now irrelevant so far as R2O is concerned. 187 However, it remains appropriate to assess a pecuniary penalty that R2O would have been ordered to pay had it remained in liquidation rather than having been deregistered (having regard to the assumption at [26] of these reasons), in respect of its contraventions in order to reflect the Court's disapproval of R2O's particular conduct having regard to the seriousness of the contraventions. This approach, on that assumption, is consistent with Australian Competition and Consumer Commission v SIP Australia Pty Ltd [2003] ATPR 41-937, Goldberg J at [59]; Australian Competition and Consumer Commission v Nonchalant Pty Ltd (in liq) [2013] ATPR 42-442, Gordon J at [46]-[47]; Australian Securities and Investments Commission v The Cash Store Pty Ltd (in liquidation) (No 2) [2015] FCA 93 ("ASIC v The Cash Store"), Davies J at [12]; Australian Competition and Consumer Commission v EDirect Pty Ltd (in liq) (2012) 206 FCR 160 at [69]. 188 As to the relationship between specific deterrence and general deterrence and the consideration that the corporation is in liquidation (or an individual might be in bankruptcy) as to the determination of a pecuniary penalty, these matters ought to be noted. In Australian Competition and Consumer Commission v Dataline.net.au Pty Ltd [2007] FCAFC 146; 244 ALR 300, the Full Court said this at [20] and [21]: 20 … [A] court may impose a penalty on a company in liquidation if, to do so, would clearly and unambiguously signify to, for example, companies or traders in a discrete industry that a penalty of a particular magnitude was appropriate (and was of a magnitude which might be imposed in the future) if others in the industry sector engaged in the same or similar conduct. This was exemplified in the judgment of O'Loughlin J in The Vales Wine Company Pty Ltd decision. 21 … Whether a penalty is imposed [on a company in liquidation] would depend on all the circumstances including the fact that the company was in liquidation and special facts, if any, surrounding the liquidation. We agree that the bare fact that a company is in liquidation is not, of itself, an immutable reason for not imposing a penalty. Nonetheless, the fact that the company is in liquidation could be a factor militating against the imposition of a penalty. However there will be cases where other factors make it clearly desirable to impose a penalty on a company even though it is in liquidation. 189 Even though the circumstances of the corporation are now that R2O is deregistered and specific deterrence is irrelevant, the Court ought to indicate the pecuniary penalty it would have imposed on the assumption at [26] so as to give full effect to the role of general deterrence having regard to the severity of the conduct. 190 A further general factor is this (assuming the hypothesis of a company in liquidation). The failure to impose a pecuniary penalty in circumstances of liquidation might encourage those individuals who represent the guiding minds of relevant corporations to fall into a false way of thinking that should a company engage in contravening conduct, one solution to the problem of non-compliance with the law and a possible pecuniary penalty is to, put metaphorically, "throw the company away" by placing it in liquidation, causing it to cease operations and then the guiding minds of the company move on to other corporate entities in the pursuit of their business model and profit. 191 As to general deterrence, ASIC contends that profit was the motivation behind the business model used by Mr Green and Mr Roberts in the R2O business. ASIC contends that, as a matter of principle, it is necessary to impose a penalty sufficient such that others in the same industry do not consider the penalty as simply a cost of doing business in pursuit of profit. ASIC emphasises that this is particularly so given the substantial cost incurred by those law-abiding businesses which comply with their legal obligations. ASIC contends that it may well be that a penalty required to achieve general deterrence will be greater than that required to specifically deter an entity in liquidation, Mr Green and Mr Roberts. 192 I am satisfied that ASIC's submissions in relation to all of the relevant circumstances of the contraventions and the contextual matters relevant to those contraventions all of which go to the question of an assessment of penalty are to be accepted. As mentioned earlier, counsel for Mr Roberts does not challenge ASIC's submissions in this regard and Mr Green does not engage with the relevant matters except to say that he takes the view that R2O's liquidation is a material matter which suggests that no pecuniary penalty ought to be imposed on an entity in liquidation and he makes other submissions about the contraventions which are relevant in considering a penalty to be imposed upon him personally in respect of the relevant contraventions under the ASIC Act in which he was knowingly concerned as described in Table 2 to the orders of 1 March 2021. Later in these reasons, I address the particular submissions made on behalf of Mr Roberts and the submissions made by Mr Green on his own behalf.

The quantum of the penalties in relation to the contraventions of the Code 193 ASIC contends that there are three categories of contraventions, namely, those in relation to s 17(4); those concerning s 17(5); and those concerning s 32A/s 23(1)(c). 194 Section 116 of the Code provides that the maximum penalty that may be imposed for a contravention of "a key requirement" of a credit contract is an amount calculated so that the total penalty for all contraventions of "the requirement" in Australia (as disclosed by the credit provider) does not exceed $500,000.00. There are in this case three clusters of contraventions of three key requirements and thus the maximum penalty in all is $1.5m. 195 As to R2O, ASIC contends that the "relative disregard" R2O had for its statutory obligations; the need for general deterrence; and the need to ensure that non-compliance is not treated as a cost of doing business, are important considerations. 196 ASIC emphasises that in at least 20 cases, R2O received greater payments than they were entitled to receive (totalling at least $29,584.99) in circumstances where there is no evidence that R2O has refunded any amounts to any consumer. ASIC also emphasises that R2O engaged in conduct that risked consumers being misled about the central element of their credit contracts (the interest rate), and R2O entered into credit contracts at greater than the maximum permissible rate of 48%. 197 Returning to Mr Hill's evidence, these matters should be noted here. 198 First, of the 232 consumers who entered into credit contracts with R2O, 140 contracts exceeded the statutory maximum annual cost rate of 48% (being 108 in the First Tranche and 32 in the Second Tranche). The amounts R2O charged those 140 customers exceeded the 48% rate in the aggregate, as earlier mentioned, of $196,576.07 (being $169,661.79 in respect of the First Tranche and $26,914.28 in respect of the Second Tranche). 199 Second, of the 232 consumers who entered into credit contracts with R2O, 177 consumers were charged more pursuant to their contracts than they ought to have been charged constituting, in the aggregate, $363,542.37 or, on average, $2,053.91 per contract. 200 Third, of the cohort of 232 consumers, R2O charged consumers pursuant to their contracts, in aggregate, $354,162.26 more than they should have charged, representing on average $1,526.56 per consumer. 201 ASIC emphasises that as to the last of these matters, the result is that R2O charged consumers $354,162.26 more than it was entitled to charge and thus, on the assumption at [26] of these reasons, the amount of any penalty that might have been imposed upon R2O ought to be greater than that amount. 202 The extent to which a pecuniary penalty ought to be greater, rather than lesser, needs to accommodate all of the factors earlier described and requires a synthesis of all of those factors. 203 The ultimate proposition put to the Court by ASIC is that in respect of R2O (had it not been deregistered), a total pecuniary penalty in the range of $600,000.00 to $1m would have been appropriate and so far as the Code contraventions are concerned, that penalty is made up of a contended range of $450,000.00 to $750,000.00. The penalty, referrable to the contraventions of the ASIC Act, is discussed below. However, as to R2O's contraventions of the provisions of the Code, I am satisfied that an appropriate pecuniary penalty that would have been imposed on R2O in respect of the contraventions of each key requirement had it not been deregistered is $200,000.00 resulting in a pecuniary penalty of $600,000.00 for all contraventions of the three clusters of the three key requirements in issue, by the credit provider. 204 As to the pecuniary penalties to be imposed upon Mr Green and Mr Roberts, the contraventions of the Code do not give rise to any civil penalty liability in Mr Green or Mr Roberts on the footing of being knowingly concerned in the contraventions by R2O of those provisions of the Code. 205 It is necessary to now consider the position in relation to the assessment of penalties in respect of the contraventions of the ASIC Act.

Assessment of penalty in relation to contraventions of the provisions of the ASIC Act 206 The contextual matters have been comprehensively described in these reasons. 207 The provisions in question are ss 12DB(1)(a) and 12DB(1)(g). 208 So far as R2O is concerned, there were 177 contraventions of each section and the theoretical maximum is $1.8m for each contravention prior to 1 July 2017 (133 contraventions) and $2.1m for each contravention after 1 July 2017 (44 contraventions). 209 For all of the reasons mentioned earlier, the contraventions are serious. 210 Having regard to the discussion above, ASIC contends that an appropriate range that would have been appropriate for a pecuniary penalty in relation to the contraventions of the ASIC Act is $150,000.00 to $250,000.00. Having regard to all of the matters described in these reasons and synthesising them into an assessment of penalty, I am satisfied that an appropriate pecuniary penalty for R2O's contraventions of the ASIC Act would have been $175,000.00, excluding any element of specific deterrence.

Mr Green and Mr Roberts 211 As to Mr Green and Mr Roberts, ASIC makes these submissions. 212 In the Liability Judgment, the Court found that Mr Green and Mr Roberts were knowingly concerned in R2O's contraventions of the ASIC Act in relation to the First Tranche contracts (being 142 contracts entered into between March and July 2017). There are 133 such contracts. In relation to those contracts, R2O charged a total of $306,244.90 more than it was entitled to charge representing, on average, $2,302.59 per contract. ASIC contends as a matter of parity between Mr Green and Mr Roberts, both individuals ought to be treated on the same footing. They were the sole directors and owners of R2O at the time of the contravening conduct. In the Liability Judgment at [381], the Court found that Mr Green was "at the absolute centre of the writing of the [price] calculators" and that he was "responsible for them". 213 As to Mr Roberts, ASIC makes these observations. 214 First, Mr Roberts was, with Mr Green, responsible for the Operations Manuals distributed to franchisees, and provided training and direction as to how the amount of the repayments was to be calculated. 215 Second, Mr Roberts was the responsible manager for the R2O ACL as from 24 December 2016: Liability Judgment at [420]. 216 Third, Mr Roberts was, with Mr Green, listed as a fit and proper person for the purposes of R2O's ACL. 217 Fourth, Mr Roberts knew, as Mr Green knew, the terms of the credit contracts and knew that they contained statements about the annual percentage rate the consumer would be charged under the credit contract: Liability Judgment at [421]. 218 Fifth, Mr Roberts attended, with Mr Green, the critical teleconference on 9 March 2017 with ASIC officers. ASIC again emphasises that the minutes record the serious concerns identified by ASIC in relation to the calculation of charges and whether the charges being imposed on the consumer entering into the credit contracts with R2O were within the 48% rate cap. ASIC emphasises that its officers told Mr Green, Mr Roberts and Mr Wills in clear terms that R2O was not calculating its charges correctly and that based on ASIC's analysis, R2O was exceeding the 48% cap: Liability Judgment at [426]. 219 Sixth, Mr Roberts chose to leave the entire question [of the operation of the price calculators such that they produced outcomes that complied with the Code] to Mr Green: Liability Judge at [48]. 220 As to the current circumstances of Mr Green and Mr Roberts at the date of the hearing of the penalty question, ASIC makes these submissions in relation to Mr Green. 221 First, Mr Green at that time was the sole director of R2O. R2O cancelled its ACL on 4 March 2020 and Mr Green ceased being a fit and proper person on its licence from the same date. 222 Second, Mr Green is presently the sole director of AASPL. AASPL does not hold an ACL or an Australian Financial Services Licence ("AFSL"). Prior to 14 October 2019, AASPL was known as "R2O Enterprises Pty Ltd". That company was described by Mr Green as being the "current system" in his email to franchisees of 6 August 2018 (Exhibit 9). 223 Third, Mr Green is presently the sole director of "Pawn Men Pty Ltd". This company does not hold an ACL or an AFSL although it holds a Queensland licence to conduct pawnbroking activities. 224 Fourth, Mr Green does not hold an ACL; is not a credit representative of an ACL holder; and is not recorded as a fit and proper person or responsible manager for an ACL holder. 225 As far as Mr Roberts is concerned, ASIC makes these submissions. 226 First, Mr Roberts gave evidence that in around December/January 2019, he and Mr Green decided to dissolve their partnership and that Mr Green would purchase the share of Mr Roberts in the business. The company extract for R2O indicates that the shareholding in the entity changed on 5 June 2019. 227 Second, the evidence of Mr Roberts was that on 22 May 2019, he instructed his solicitors to complete the necessary forms so as to resign as a director and to notify ASIC and Mr Green that he would need to be replaced as a "key person" on the ACL. ASIC notes that its records indicate that Mr Roberts ceased as a director on 23 May 2019 and ceased as responsible manager upon the cancellation of R2O's ACL on 4 March 2020. 228 Third, Mr Roberts does not hold an ACL; is not a credit representative of an ACL holder; and is not recorded as a fit and proper person or responsible manager for an ACL holder. Nor is Mr Roberts currently a director of any company. 229 ASIC emphasises that questions of general and specific deterrence and the notion that pecuniary penalties ought not to be seen or treated as merely a cost of doing business, are central considerations in assessing the penalty to be imposed upon Mr Green and Mr Roberts. 230 ASIC emphasises that, as noted earlier, R2O charged a total of $306,244.90 more than it was entitled to charge (amounting to, on average, $2,302.59 per contract) in relation to 133 contracts where Mr Green and Mr Roberts were involved in the relevant ASIC Act contraventions. All of these contracts were entered into after ASIC had expressed its concern about R2O entering into contracts that charged consumers more than it was entitled to charge. ASIC also emphasises, as mentioned earlier, that Mr Green and Mr Roberts were both in the teleconference with ASIC on 9 March 2017 where ASIC expressed its particular concerns as already mentioned at [123] of these reasons. Those matters do not need to be repeated here. 231 Having regard to all of these matters, ASIC contends that it is reasonable to adopt a range of penalties in respect of the ASIC contraventions by Mr Green and Mr Roberts of $150,000.00 to $250,000.00. 232 Each case turns on its own facts and, ultimately, little is to be gained by seeking to align other cases with the very particular circumstances of this case. That said, I have had regard to five cases emphasised by ASIC as relevant and useful. I have simply taken them into account. They are ASIC v The Cash Store; ASIC v Make It Mine; and Australian Securities and Investments Commission v Fast Access Finance Pty Ltd (No 2) [2017] FCA 243; Australian Securities and Investments Commission v Channic Pty Ltd (No 5) [2017] FCA 363; and Australian Securities and Investments Commission v Thorn Australia Pty Ltd [2018] FCA 704. 233 As to the totality principle, the Court is required to ensure that the penalties in the aggregate are just and appropriate. 234 In applying the totality principle, ASIC contends that it remains important in determining the penalty to ensure that the total amount not be regarded as a cost of doing business having regard to the amount R2O charged customers above that which it was entitled to charge (whether by virtue of charging interest at an interest rate greater than the statutory cap of 48% or because the amounts charged were greater than the interest rate recited on the contract). 235 ASIC also emphasises this matter. It says that while Mr Green, at the date of the hearing, was the sole director of R2O, its sole shareholder was PWMZ Pty Ltd and the sole shareholder of that company is Mr Green's wife, Wendy Green. ASIC observes that whether any penalty imposed on R2O is likely to be paid by it given its current financial position, and if so, whether one of the individual respondents might ultimately carry the burden of paying that penalty, is a factor to be taken into account by the Court in determining the quantum of penalty across the three respondents, in order to ensure that the penalty in total is not oppressive: Australian Competition and Consumer Commission v High Adventure Pty Ltd [2005] FCAFC 247 at [14] and Australian Competition and Consumer Commission v Westminster Retail Pty Ltd [2005] FCA 1299 at [48] and [50]. ASIC submits that the factors identified and discussed as reflected in these reasons overwhelmingly weigh in favour of substantial penalties for each of the corporate entity and Mr Green and Mr Roberts. ASIC also notes that R2O has surrendered its ACL and is no longer trading in the consumer credit segment of the marketplace. It observes that based on the current evidence, questions arise about R2O's capacity to pay the amount of the penalty. 236 Mr Green has made it plain that R2O is in liquidation, is not trading and has no capacity to pay any penalty, and now the company is deregistered. On the assumption mentioned earlier at [26] of these reasons, there are sound reasons in principle why there is utility in the Court indicating what would have been a reasonable and appropriate penalty to be imposed upon R2O had it simply been in liquidation rather than deregistered, at least so as to indicate the Court's view of the relationship between the seriousness of the conduct and general deterrence. No pecuniary penalty can now be imposed on the credit provider by reason of its deregistration. 237 Before determining the question of a pecuniary penalty to be imposed upon Mr Green and Mr Roberts, it is important to have careful regard to the submissions made on behalf of each of them. I now turn to those matters.

The submissions and contentions of Mr Green made by him on his own behalf 238 In Mr Green's written submissions, he opens his commentary by saying that he is "going to speak honestly, frankly and open[ly]". To the extent that Mr Green seeks to challenge findings of fact made in the Liability Judgment, those findings are to be applied in the consideration of the assessment of a pecuniary penalty concerning Mr Green's conduct of being knowingly concerned in contraventions of the ASIC Act provisions. 239 The subject matter, content and purpose of those provisions has already been described extensively in these reasons. 240 The findings of fact from the Liability Judgment have also been described extensively in these reasons and, of course, these reasons ought to be read in conjunction with the extensive reasons from the Liability Judgment. 241 Nevertheless, I note the following matters put by Mr Green. 242 As to the significance of the meeting of 9 March 2017 (discussed throughout these reasons), Mr Green says that the meeting was arranged by Mr Wills after many "back and forth emails on various concerns" of an officer of ASIC in relation to R2O's processes and documents. Mr Green says that ASIC's "initial concerns" did not relate to "overcharging". I assume that Mr Green is saying that the back and forth emails leading to the meeting of 9 March 2017 did not concern overcharging. 243 As to the meeting on 9 March 2017, it is clear that ASIC was expressing concern about overcharging in the sense that the cost or interest rate exceeded the statutory cap; concern about the calculation of charges; "wide and serious" concerns; and the "steps" R2O ought to take to deal with the problems. Indeed, ASIC was suggesting that R2O ought to cease its operations pending the resolution of the articulated concerns: see [124] of these reasons and the text of the minute of the meeting. 244 Mr Green says that Mr Wills sought to clarify with ASIC "exactly what" ASIC wanted R2O to do to comply with requests made of it by ASIC. Mr Green says that ASIC officers seemed to constantly raise a number of matters of concerns such as car advertisements not being compliant, R2O's contract wording being incorrect and the calculations relating to charges not being compliant. Mr Green says that "no reason" was given as to why the calculations were not correct. Mr Green says that "in true ASIC form" ASIC's officer did "not give guidance" on how the calculator ought to be operating so as to be within the requirements of the Code and the particular compliance mechanism was not made clear to Mr Wills, R2O or R2O's lawyers, MinterEllison. 245 The simple fact in this case is that Table 1 to the orders of 1 March 2021 sets out the many contraventions of the Code and the ASIC Act provisions and Table 2 sets out the extent to which Mr Green was knowingly concerned in contraventions of the Code and, relevantly for present purposes, the ASIC Act provisions in relation to the 142 First Tranche contracts. 246 The abiding obligation of Mr Green and Mr Roberts, but relevantly for present purposes, Mr Green, was to take steps to ensure that R2O complied with the law and, relevantly here, that Mr Green was not knowingly concerned in contravention of the ASIC Act provisions. 247 ASIC was making its position very clear in the meeting of 9 March 2017. 248 It is true that R2O sought advice from Mr Wills and from MinterEllison. R2O, drawing upon its own expertise (and "skill sets", apparently held by Mr Green and Mr Roberts) together with the support of the professional advisers such as Mr Wills and Mr Lathan of MinterEllison, was required to take all steps to ensure that it complied with the law. 249 Mr Wills says that ASIC's submission that Mr Wills supplied R2O with a "correct calculator" in August 2017 is incorrect because what actually occurred was that Mr Wills, on 14 August 2017, used a calculator formulated by him to "check" R2O's current contracts to determine whether the interest rate charged by each contract was within the requirements of the Code. Mr Green says that a complete check was conducted of all contracts (at that time) and the results were submitted to ASIC. Mr Green says that R2O checked all of the contracts using the "exact method and instructions" supplied in an email from Mr Greg Ash of "QED Risk". Mr Green says that the email was put in evidence and Mr Ash gave evidence that his "instructions" in the email were correct. He says that ASIC knew, at this time, that the instructions were not correct yet attributed errors to Mr Green on the footing that he should have known that the "instructions" were not correct. Mr Green says that QED Risk holds itself out as a compliance expert and "so why would I even question what was supplied and the directions given". 250 The point of these remarks really is that Mr Green is saying that he relied upon QED Risk to formulate, taking into account his instructions, a method of calculation which was compliant with the Code. I accept that Mr Green acted upon advice given to him by Mr Wills but two things need to be kept in mind. First, as Mr Green notes, the work of QED Risk is predicated on the instructions given to the adviser and second, it remains the obligation of R2O (and its advisers to the extent that R2O seeks to comply with the law by taking advice from an expert and calculation methodology), to comply with the law. 251 Nevertheless, I take into account that Mr Green was seeking to obtain support on these questions from Mr Wills and Mr Ash. 252 Mr Green makes a further point which is odd. He says that a material matter to take into account is that R2O's contracts "were never binding" and "therefore" a customer could never be "disadvantaged" and "could return the car without any further payments and their contract would be terminated". First, the contracts are, just that, contracts. The circumstance that a customer might be able to surrender or return the car without any "further payments" and with their contract being "terminated", does not answer the proposition that the contracts were on foot, and R2O engaged in contraventions of the Code in bringing them into existence (at least so far as 232 contracts are concerned) and, relevantly here, nor does it answer the proposition that Mr Green was knowingly concerned in the ASIC Act contraventions. 253 Mr Green also says that "at no time did R2O or its directors purposely or intently set out to overcharge customers". He says that, in fact, the approach was the "complete opposite" which, he says, can be seen in R2O's decision to "set a common interest rate of 45% to avoid breaching the cap rate of 48% regardless of the fact the formulas in the calculators were incorrect". 254 Notwithstanding these remarks, the fact is that the calculators were incorrect, the interest rate cap was exceeded in the manner and scale described in these reasons and, relevantly for present purposes, R2O engaged in contraventions of the ASIC Act provisions and Mr Green was knowingly concerned in those contraventions. 255 Mr Green says that the ultimate result that the cap was exceeded and that the calculators were incorrect was a function of "ASIC not supplying relevant support and information on calculators when issuing new Credit Licences". Mr Green says that if "proper guidance, information and training" had been supplied by ASIC (prior to new ACLs being issued), "then no overcharging would have occurred". 256 I reject these contentions. 257 The contraventions in these proceedings are not a function of failures on the part of ASIC to provide briefing sessions and compliance training to Mr Green or Mr Roberts or both so as to enable R2O to comply with obligations arising under the law. R2O's obligation is to ensure that it complies with the law and the obligations of the directors include ensuring that R2O complies with the law. 258 Moreover, from 9 March 2017, R2O and its directors could not have been in any doubt that ASIC held serious concerns about R2O's compliance with the law. 259 Mr Green says that it is very clear that ASIC and others involved in this case have not understood the "structure of the business model" adopted by R2O as ASIC and others seem to believe that R2O "directly benefited and profited" from "overcharging customers" due to the amount of interest charged. Mr Green says that this is conception is entirely false because: all funds received from customer payments were transferred back to the owners of the asset on a daily basis; and R2O only received a franchise fee of $300.00 per contract as a "one off payment" when a contract was issued and there were no "ongoing payments". 260 These propositions are not consistent with the contracts or the evidence. 261 At para 13 of his submissions, Mr Green asks a set of questions about why it is that the Court did not make findings that the R2O contracts were "never binding"; why the Court did not make findings about the accuracy (or otherwise) of the position taken by Mr Ash; why the Court did not acknowledge that R2O "never had any interest to overcharge"; why the Court did not acknowledge that R2O had no customer complaints; and why the Court did not acknowledge that R2O and its directors did not profit from any "unintentional" overcharging. 262 As to these matters, the Court was concerned to determine whether contraventions of the Code had occurred by reason of the content, text and structure of the contracts and whether the conduct of Mr Green and Mr Roberts involved conduct on their part of being knowingly concerned in contraventions of the Code and the ASIC Act by them. The reasons in the Liability Judgment address comprehensively all of the relevant conduct in evidence and the content and structure of the contracts. To the extent that Mr Green, by these questions, is asserting that he had no intention to overcharge and that overcharging which occurred was "unintentional", those matters have been noted and aspects of that consideration are, of course, taken into account. 263 Finally, Mr Green reasserts in his submissions that at no time did R2O "purposely" set out to overcharge customers and "absolutely believed" their calculations to be well within the capped rate of 48%. He says that R2O "regretfully accepted" ASIC's propositions put to R2O. He says that has no intention of "wanting anything to do with supplying credit or applying for [an ACL] ever in the future". He says that in good faith R2O stopped trading on 30 June 2018 and surrendered its ACL. 264 He says that he is happy to accept whatever penalties and injunctions are determined although he does not "have the capacity to financially pay maximum fines …". 265 Mr Green says that "to simply mediate and correct process faults that were in no way intentional would have given a better result for both parties …". 266 These submissions by Mr Green have been taken into account. The contentions and the observations in these reasons about them need to be set in the context of the extensive analysis of all of the 232 contracts and the important normative standard reflected in the ASIC Act provisions contravened by R2O and the knowing concern of Mr Green in relation to the contravention by R2O of those provisions so far as they relate to the First Tranche contracts.

The submissions and contentions of Mr Roberts made by counsel on his behalf 267 Again, the question under consideration is the extent to which a pecuniary penalty is to be imposed upon Mr Roberts in respect of his knowing involvement in R2O's contraventions of the ASIC Act provisions in relation to the First Tranche contracts. 268 Mr Roberts makes no submissions again or in reply to ASIC's submissions on the question of injunctions and submits to the Court's judgment on that question. 269 However, Mr Roberts submits that the Court should impose upon him a penalty in the lowest end of the range of possible penalties and the Court should make no order as to costs against him. Counsel for Mr Roberts contends that whilst Mr Roberts is liable to have a pecuniary penalty imposed, the factual circumstances of his involvement in the ASIC Act contraventions indicates that the penalty ought to be at the lowest range of what may be imposed. 270 The circumstances which inform those propositions are said to be these. 271 The financial circumstances of Mr Roberts are "already parlous". In 2017, R2O paid one dividend, from which Mr Roberts received a maximum amount of $50,000.00. 272 As to the contraventions, the contentions are that the involvement of Mr Roberts in the ASIC Act contraventions involve no dishonesty; was not deliberate; was characterised "merely by incompetence and a lack of diligence" which was nonetheless "honest and in good faith"; and in all the circumstances, was "more peripheral to the core facts and actions" which constituted the contraventions. 273 Counsel for Mr Roberts makes the point that Mr Roberts is no longer involved in the consumer credit industry and nor is he associated with or a shareholder of R2O. Nor does he derive "any benefit whatsoever" from R2O. 274 Counsel for Mr Roberts also emphasises that Mr Roberts does not contest or oppose the injunctions sought against him by ASIC; has cooperated with ASIC's investigations; did not contest the trial which led to the Liability Judgment and expressly undertook to submit to the Court's findings in the Liability Judgment; and sought to direct R2O to give enforceable undertakings to ASIC to assist it further in resolving the subject matter of ASIC's concerns before ASIC commenced the enforcement proceedings. 275 A further matter emphasised on behalf of Mr Roberts is that he directed R2O's franchisees to "use a defect-free loan calculator to review all active contracts and adjust them in consumer's favour to be compliant with the Code in [an] attempt to remedy" the contraventions. Also, counsel emphasises that Mr Roberts "feels a sense of contrition and remorse for his involvement" in the contraventions and already feels "a great sense of loss in connection with the proceeding". 276 As to particular considerations derived from TPC v CSR and NW Frozen Foods, the following submissions are made on behalf of Mr Roberts. 277 As to the nature and extent of his contravening conduct, counsel for Mr Roberts emphasises that where a breach arises in circumstances in which the parties do not believe that they are doing anything wrong, and their conduct is merely motivated by a desire to achieve a reasonable level of profitability without causing harm to the public, the penalty imposed should be at the lower end of the scale: Trade Practices Commission v Cook-On Gas Products Pty Ltd [1985] ATPR 40-560. 278 Mr Roberts contends that whilst he was, equally with Mr Green, responsible for the Operations Manuals distributed to franchisees of R2O, and also provided training and direction as to how the repayment amounts were to be calculated, Mr Roberts "did all of these things in reliance upon his mistaken belief that such instructions led to outcomes that were compliant with the Code". Mr Roberts says that Mr Green created the "defective calculators". Mr Roberts emphasises that the Court found that Mr Green was "at the absolute centre of the writing of the calculators" and "was responsible for them": Liability Judgment at [381]. 279 As to the meeting with ASIC on 9 March 2017, Mr Roberts says that ASIC makes much of this meeting as the basis upon which it contends that Mr Roberts and Mr Green had "perfect knowledge" of the basis upon which their calculator was flawed and upon which contracts utilising that calculator were "misleading" as to the true rate of interest. Mr Roberts accepts that, along with Mr Green, he was made aware at the meeting on 9 March 2017 of the essential facts and that ASIC had "serious concerns" about the "method of calculation". However, like Mr Green, Mr Roberts says that he was not "sufficiently aware of how the calculator was flawed". 280 Mr Roberts accepts that it is a valid criticism of him (and Mr Green) that on the basis of what they "did know or ought to have known about the calculator" (which were the essential facts of the contravention) that they were knowingly concerned in the contraventions, and Mr Roberts accepts that "it was an act of incompetence to not know how the calculator was flawed". 281 However, counsel for Mr Roberts contends that it is not appropriate to say that Mr Roberts was (or Mr Green or both were) "fully awakened and apprised of the extent of the contraventions inherent in the calculator from the time of the ASIC meeting" or that the contraventions by R2O or the involvement of Mr Roberts in them became "deliberate" (in the sense that Mr Roberts knew that the calculator was actually resulting in the contraventions), "because of" the ASIC meeting on 9 March 2017. 282 The contention is that the result of the 9 March 2017 meeting was not that it brought home to Mr Roberts that the calculator was resulting in interest charges that gave rise to contraventions, but rather that "Mr Roberts was apprised that ASIC had concerns that the calculator may not be compliant, and had asked him and Mr Green whether the formula was compliant, and neither Mr Green, much less Mr Roberts (who was not involved in the calculator's creation), were then able to answer those queries" [emphasis added]. 283 Counsel for Mr Roberts contends that owing to a "lack of diligence and individual competence" on the part of Mr Roberts, Mr Roberts did not himself certify that the calculators, or the training and instruction on how to use them, led to a repayment outcome that was compliant. Rather, such failures are essentially tantamount to saying that Mr Roberts "failed to adequately police what his co-director was doing", and in relying upon what his co-director was doing, "he carelessly allowed by omission the outcomes of the [c]ontraventions to materialise". 284 Counsel for Mr Roberts contends that this is the "highest criticism" that can properly be made of the conduct of Mr Roberts and this illustrates that his involvement in the contraventions was "much more peripheral" than the involvement of Mr Green. 285 Mr Green, by contrast, was the guiding mind of the company with regard to the matters giving rise to the contraventions. 286 As to the question of cooperation with ASIC, the contention is that Mr Roberts was "keen to cooperate with ASIC" and in his personal capacity he cooperated with ASIC in its investigations and examinations. He says that he wanted R2O to cooperate fully with ASIC and sought to direct R2O to give enforceable undertakings to ASIC to enable it to monitor R2O's compliance, when such an undertaking was proposed by ASIC in March 2017. Mr Roberts says that R2O did not give the enforceable undertaking because Mr Green, as the only other director of the company, "did not allow it". Counsel emphasises that in May 2019, Mr Roberts in his own capacity offered an undertaking that he would not be a director of a company or be involved in credit activity. The contention is that to the extent that R2O did not cooperate more with ASIC in circumstances where it could have done so, this conduct was attributable to Mr Green's desire to resist ASIC's originating application. 287 As to the question of whether there is any similar conduct on the part of Mr Roberts, the submission is that he has no prior history of engaging in or having been involved in any similar conduct. 288 As to the financial circumstances of Mr Roberts, these matters are emphasised. As mentioned earlier, his present financial circumstances are parlous and he has no continuing relationship with R2O and draws no income from it. In 2018, Mr Roberts separated permanently from his wife and in accordance with the terms of the separation (and property consent orders), he had to sell his matrimonial home, which occurred in January 2019. Since January 2019, he has worked on an irregular basis and has supplemented his limited income with support from Centrelink. He has no significant assets and at the date of the submissions, Mr Roberts had approximately $10,000.00 in cash at bank and no superannuation. Whilst the financial circumstances of a respondent and his or her ability to pay, are not determinative of the penalty to impose, the financial circumstances of the person remain a relevant consideration to be taken into account together with the need to serve the purpose of general deterrence. The point is made on behalf of Mr Roberts that the object of ensuring effective deterrence is not served by simply imposing a penalty that could not be paid by the respondent. On this issue, reliance is placed upon the dissenting observations of Kirby P in Smith v The Queen (1991) 25 NSWLR 1 at 21, in these terms: The imposition of a fine which is totally beyond the means of the person fined and which the Court, the prisoner and the community realise has no prospect whatsoever of being paid, does nothing for the deterrence of others. Such a fine is seen by the community for what it is: a symbolic act of the law without intended substance which neither coerces the particular prisoner nor convinces the community. 289 These observations to the extent that they have application in the context of an approach to deterrence in respect of civil penalty provisions, is said to be "echoed" with approval by Middleton J in Director of Consumer Affairs Victoria v Hocking Stuart Richmond Pty Ltd [2016] FCA 1184 at [30]-[33] in these terms (leaving aside [31] which quotes the above extract from Smith v The Queen]: 30 I accept that care must be taken in transplanting principles from criminal law directly to the area of civil penalties. However, as in criminal sentencing, sanctions in the form of fines or penalties should strive to impose equal effects on offenders with differing resources. Further the imposition of a fine or penalty that is beyond the ability of the contravener to pay does not necessarily promote general deterrence. 31 [the quoted passage above at [288f] of these reasons] 32 Therefore, the amount of penalty should, in general, be set having regard to an amount the contravener can realistically be expected to discharge and should not be unnecessarily oppressive. This is not determinative, but is a factor. Of course, if the contravener has organised his or her affairs to render themselves beyond sanction, different considerations will apply. 33 Nevertheless, a penalty should not be set so low that it does not meet the goal of general deterrence, even if that low penalty acts in the circumstances as a specific deterrent having regard to the individual financial circumstances of the contravener. 290 Mr Roberts contends that the imposition of a penalty "even approximating" the amount suggested by ASIC, would likely force Mr Roberts into bankruptcy and the "serious consequences" for Mr Roberts ought to be considered in the context of his "relative slightness" of involvement in the contraventions and the other mitigating circumstances already mentioned. Moreover, Mr Roberts did not gain financially by reason of the contributions and does not recall any regular dividend paid to him by R2O except a dividend of $50,000.00 in the 2017 financial year. Because of the year in which it was paid, some part of that dividend may be attributed to revenue gained by R2O over the period in which Mr Roberts has been found to have been knowingly involved in the relevant contraventions. 291 The contention is that the true extent of his direct benefit due to overcharging upon contracts the subject of the contraventions should be limited to the amount of the overcharging that occurred prior to the dividend being issued with an absolute limit of $50,000.00 as the measure of the maximum "benefit". Mr Roberts says that upon ceasing to be a director of R2O, he paid the company $50,000.00 by way of returning a security deposit to the company and thus, in essence, he paid back to R2O all the money he received from the company by way of a dividend. Mr Roberts says that his salary from R2O of $100,000.00 per annum would have been paid to him by R2O in the absence of the contraventions and was not the product of overcharging upon contracts. He received no bonuses. 292 As to specific deterrence, Mr Roberts contends that the fact that he has willingly submitted to a lengthy period of injunction and holds no intention of ever being involved in consumer credit or holding an ACL or being a director again, signifies that the need for further specific deterrence is very low. 293 Whilst Mr Roberts accepts that any penalty imposed should not be so light as to be seen merely as a cost of doing business and that persons who do not comply with the regime can see that those who contravene the regime receive a suitable penalty, what is necessary to achieve general deterrence must be viewed in the context of the individual case and the circumstances of the contravening party. 294 Having regard to his financial circumstances and the consideration that he obtained no real benefit from the contraventions in which he was knowingly involved, any pecuniary penalty imposed upon him could not be construed, it is said, as being merely a cost of doing business. Relevant circumstances are said to be that the proceeding has already resulted in the end of his business; and the injunctions will prevent future engagement in such businesses. 295 Mr Roberts says that even a minor pecuniary penalty, when added to these considerations, would bring about a "harsh imposition" upon Mr Roberts and his future livelihood, and would more than adequately meet the need of the Court to mark its disapproval of his conduct. Mr Roberts contends that a large pecuniary penalty would be oppressive and would operate in an "overly punitive" way. 296 As to his personal circumstances, Mr Roberts says that the process of investigation and then enforcement proceedings by ASIC has been a "deeply taxing and sobering experience" for Mr Roberts. He suffers from severe osteoarthritis in both legs and needed surgical intervention in 2017. He received surgery in 2019. He says that although ASIC contends that R2O poorly managed the seeking of advice about the methodology inherent in its loan calculator, no detail of that poor management is given. Mr Roberts says that there was some delay in obtaining the advice but the delay was slight. He says that his conduct of being less than diligent in not "running to ground" every potential issue suggested by ASIC in the meeting of 9 March 2017 and not seeking advice about the calculator is partially explained, although not excused, by the emotional stress he was suffering and his illness. 297 Mr Roberts cites a number of authorities as precedents for the imposition of a penalty. They are set out at paras 35 to 38 of the submissions. 298 The Court has taken all of them into account. 299 The ultimate position adopted by Mr Roberts is that he has cooperated with ASIC; he submits to the injunctions; there is little or no further need for "specific deterrence"; the nature of his involvement in the contraventions was peripheral and involved no dishonesty or covert, deliberate or intentional action. Thus, a penalty in the lower range would constitute a civil penalty that reflects the totality of his involvement in the course of conduct constituting the contraventions whilst adequately serving the need for specific and general deterrence in the wider context of his financial circumstances.

Consideration of the penalty to be imposed upon Mr Green and Mr Roberts 300 I have taken into account all of ASIC's submissions and each of the matters relied upon by Mr Green and Mr Roberts. 301 It is not necessary to repeat here in detail the particular features taken into account. It is sufficient to note these matters. (1) Mr Green and Mr Roberts were knowingly concerned in contraventions of the two sections of the ASIC Act in respect of 133 contracts (First Tranche). (2) The conduct is extensive and serious. (3) The conduct involves knowing concern in contravention of important normative standards imposed by the two provisions of the ASIC Act. (4) Although there are contentious views about the gravity of the meeting on 9 March 2017, it is clear that ASIC clearly and squarely put its concerns to Mr Green, Mr Roberts and R2O. It is not necessary to repeat the content of those matters here. (5) Although Mr Roberts characterises his failures in the way he does by way of an explanation but not an excuse, that characterisation is, in fact, not a satisfactory explanation. (6) I accept that Mr Green was at the centre of the contravening conduct and I will not repeat the descriptions of his conduct drawn from the Liability Judgment as already mentioned. (7) Although Mr Green was at the centre of the conduct, it is not a sufficient explanation for Mr Roberts that he simply relied upon Mr Green's conduct. (8) I have taken into consideration all of the personal circumstances put to the Court on behalf of Mr Roberts and, of course, the submissions put by Mr Green personally. (9) I have taken into account the conduct and all of the findings from the Liability Judgment, also addressed in these reasons. (10) I have taken into account the observations set out in the quoted passages at [288] and [289]. However, the guiding principles are those set out at [94]-[108] and [184]-[190]. I accept, however, that the personal circumstances and the burden of the penalty upon the individuals is an important matter to take into account. (11) Because the conduct is significant, involves 133 contracts and is serious, the Court needs to mark its concern as to that conduct. (12) It is not correct to say that the conduct caused no harm. Consumers were affected and the extent of the effect upon the consumers who entered into the contracts is described in these reasons. 302 Taking into account all of these matters, I am satisfied that an appropriate pecuniary penalty to impose upon Mr Green is $138,000.00 and an appropriate pecuniary penalty to impose upon Mr Roberts is $90,000.00. 303 ASIC also seeks a remedy in the form of injunctions restraining each of Mr Green and Mr Roberts from engaging in credit activity or being involved in a business engaged in a credit activity for a period within the range of three to four years. 304 Mr Roberts makes no submissions in relation to this aspect of the matter and says that he will simply abide by the order of the Court. 305 Mr Green adopts the same position in slightly different language in his written submissions. 306 It is not necessary to recite in these reasons the well-understood principles governing the grant of an injunction in the circumstances of the case. 307 I accept that the principles are correctly stated at paras 174 to 201 of ASIC's submissions. Having regard to those considerations and the conduct generally, I am satisfied that an injunction in the terms sought by ASIC should be granted in respect of Mr Green and Mr Roberts for a period of three years. 308 As to R2O, the entity has surrendered its ACL, went into liquidation and is now deregistered. Any question of an injunction does not now arise having regard to those circumstances. 309 The only remaining question is the question of costs. 310 As to Mr Roberts, he says that there ought to be no order as to costs. He takes that position for the following reasons: he did not contest the liability hearing; he submitted to whatever findings might be made; his position of not contesting the proceeding is likely to have simplified the trial; his decision to not challenge the grant of an injunction is likely to have saved ASIC some costs; he has only sought to be heard on costs; he had no control over the defence filed by R2O or the matters which Mr Green sought to raise at trial resulting in a contest on the question of liability. 311 Notwithstanding these considerations, the fact is that ASIC was required to commence proceedings to establish the contravening conduct on the part of R2O and, relevantly here, the contravening conduct of Mr Green and Mr Roberts. The order as to costs against Mr Roberts ought to reflect many of the factors he has described as it is true to say that he sought to reduce the burden cast upon ASIC in relation to such a wide field of contravening contracts. Nevertheless, his conduct has contributed to contravening conduct and especially, of course, his conduct of being knowingly concerned in 133 contracts involving contraventions of the ASIC Act provisions. An order for costs will be made against Mr Roberts for 50% of ASIC's costs of and incidental to the proceedings against Mr Roberts. An order will be made against Mr Green for the payment of ASIC's costs of and incidental to the proceedings against him. 312 The formal orders to be made will simply be that ASIC submit orders within seven days for the consideration of the Court giving effect to these reasons. The indications of a pecuniary penalty that would have been imposed on R2O in liquidation had that been the prevailing position, are identified, as mentioned, simply for the purposes set out at [26] of these reasons, but of course, no pecuniary penalty can now actually be imposed on the deregistered entity. Otherwise, proposed orders are to be submitted by ASIC within seven days giving effect to these reasons. I certify that the preceding three hundred and twelve (312) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Greenwood.

Associate: Dated: 4 May 2022 ANNEXURE A In this Order: (a) "Table 1", and "Table 2" mean the two tables attached to this order which contain the particulars of each of the credit contracts which are the subject of this proceeding. (b) The "credit contracts" are those identified in Table 1 and Table 2 by reference to the name of the consumer or consumers with whom they were entered into and the date on which they were entered into. (c) References to sections of the National Credit Act are references to the National Consumer Credit Protection Act 2009 (Cth). (d) References to the National Credit Code are references to Schedule 1 to the National Credit Act. (e) References to the ASIC Act are references to the Australian Securities and Investments Commission Act 2001 (Cth). THE COURT DECLARES THAT: Declarations against Rent 2 Own Cars Australia Pty Ltd

1. Between 1 March 2017 and 18 June 2018, Rent 2 Own Cars Australia Pty Ltd contravened: (a) s32A of the National Credit Code by entering into credit contracts with an annual cost rate that exceeded 48% in respect of the 140 credit contracts marked with an "X" in column A of Table 1; (b) s23(1) of the National Credit Code by entering into credit contracts that imposed a monetary liability on consumers in respect of an interest charge in contravention of s32A of the National Credit Code in respect of the 140 credit contracts marked with an "X" in column B of Table 1; (c) s17(4) of the National Credit Code by failing to disclose the annual percentage interest rate applicable to the credit contract in respect of the 187 credit contracts marked with an "X" in column C of Table 1; and (d) s17(5) of the National Credit Code by failing to disclose to the consumer the method of calculation of the interest charges payable under the contract in respect of the 232 credit contracts marked with an "X" in column D of Table 1.
2. Between 1 March 2017 and 18 June 2018, by charging an interest rate higher that the rate represented on the credit contract, in relation to the 177 credit contracts marked with an "X" in column E of Table 1, Rent 2 Own Cars Australia Pty Ltd contravened: (a) s12DA(1) of the ASIC Act by engaging in conduct in relation to financial services that was misleading or deceptive or was likely to mislead or deceive; (b) s12DB(1)(a) of the ASIC Act by making false or misleading representations in connection with the supply or possible supply of financial services that its services were of a particular standard, quality, value or grade; and (c) s12DB(1)(g) of the ASIC Act by making false or misleading representations in connection with the supply or possible supply of financial services with respect to the price of the services. Declarations against Timothy James Roberts
3. Between 1 March 2017 and 18 June 2018, Timothy James Roberts was knowingly concerned in the contraventions by Rent 2 Own Cars Australia Pty Ltd of: (a) s32A of the National Credit Code in relation to the 108 credit contracts marked with an "X" in column A of Table 2; (b) s23(1) of the National Credit Code in relation to the 108 credit contracts marked with an "X" in column B of Table 2; (c) s17(4) of the National Credit Code in relation to the 142 credit contracts marked with an "X" in column C of Table 2; and (d) s17(5) of the National Credit Code in relation to the 232 credit contracts marked with an "X" in column D of Table 2.
4. Between 1 March and 6 September 2017, in relation to the 133 credit contracts marked with an "X" in the column E of Table 2, Timothy James Roberts was knowingly concerned in the contraventions by Rent 2 Own Cars Australia Pty Ltd of ss 12DA(1), 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. Declarations against Paul Anthony Green
5. Between 1 March 2017 and 18 June 2018, Paul Anthony Green was knowingly concerned in the contraventions by Rent 2 Own Cars Australia Pty Ltd of: (a) s32A of the National Credit Code in relation to the 108 credit contracts marked with an "X" in column A of Table 2; (b) s23(1) of the National Credit Code in relation to the 108 credit contracts marked with an "X" in column B of Table 2; (c) s17(4) of the National Credit Code in relation to the 142 credit contracts marked with an "X" in column C of Table 2; and (d) s17(5) of the National Credit Code in relation to the 232 credit contracts marked with an "X" in column D of Table 2.
6. Between 1 March and 6 September 2017, in relation to the 133 credit contracts marked with an "X" in the column E of Table 2, Paul Anthony Green was knowingly concerned in the contraventions by Rent 2 Own Cars Australia Pty Ltd of ss 12DA(1), 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. THE COURT ORDERS THAT:
7. Pursuant to section 177(1) of the National Credit Act, Rent 2 Own Cars Australia Pty Ltd is restrained from further contraventions of sections 32A, 23(1), 17(4) and 17(5) of the National Credit Code.
8. Pursuant to section 12GD(1) of the ASIC Act, Rent 2 Own Cars Australia Pty Ltd is restrained from further contraventions of sections 12DA, 12DB(1)(a) and 12DB(1)(g) of the ASIC Act.
9. Pursuant to section 177(1) of the National Credit Act, Timothy James Roberts is restrained from being knowingly concerned in further contraventions of sections 32A, 23(1), 17(4) and 17(5) of the National Credit Code.
10. Pursuant to section 12GD(1) of the ASIC Act, Timothy James Roberts is restrained from being knowingly concerned in further contraventions of sections 12DA, 12DB(1)(a) and 12DB(1)(g) of the ASIC Act.
11. Pursuant to section 177(1) of the National Credit Act , Paul Anthony Green is restrained from being knowingly concerned in further contraventions of sections 32A, 23(1), 17(4) and 17(5) of the National Credit Code.
12. Pursuant to section 12GD(1) of the ASIC Act, Paul Anthony Green is restrained from being knowingly concerned in further contraventions of sections 12DA, 12DB(1)(a) and 12DB(1)(g) of the ASIC Act. TABLE 1 - CONTRAVENTIONS BY RENT 2 OWN CARS AUSTRALIA PTY LTD First Tranche of Contracts (2017 Credit Contracts) A B C D E No. Consumer Name Date of Contract s32A s23(1) s17(4) s17(5) ss12DA, DB(1)(a) & (g) 1 ABBOTT, Adele 7/06/2017 X X X X X 2 ABRAHAMS, Luke 10/06/2017 X X X X X 3 ABSOLOM, Karen 5/04/2017 X X X X X 4 ACTON, Brendan 3/07/2017 X X X X X 5 AERENGA, Tangi 9/06/2017 X X X X X 6 ANSON, Anastasia 9/06/2017 X X X X X 7 ARMSTRONG, Kate 10/05/2017 X X X X X 8 ASPINALL, Mika-Lee & MARTIN, Blair 12/05/2017 X X X X X 9 BALDACCINO, Shannon 21/04/2017 X X X X X 10 BANNERMAN, Kristine 6/06/2017 X X X X X 11 BARTLEY, Robert 5/04/2017 X X 12 BECK, Thomas 7/04/2017 X X X X X 13 BECKINGHAM, Kyle 15/06/2017 X X X X X 14 BERY, Tod 14/06/2017 X X X X X 15 BILLY, Gibson 14/06/2017 X X X 16 BINGE, Belinda 2/05/2017 X X X X X 17 BLACKLER, Warrick 20/04/2017 X X X X X 18 BORG, Andrew 3/05/2017 X X X X X 19 BRAND, Matthew 19/04/2017 X X X X X 20 BROOKES, Lisa 19/04/2017 X X X X X 21 BROWNE, Diane 8/05/2017 X X X X X 22 BUSHBY, Steven 16/05/2017 X X X X X 23 CANZLER, Rick 8/06/2017 X X X X X 24 CARBERRY, Anthony & Nicole 7/04/2017 X X X X X 25 CASTLEDINE, Phillip 10/04/2017 X X X X X 26 CHETWYND, Rhianna 29/05/2017 X X X 27 CHISENGALUMBWE, Ngoza 2/06/2017 X X X X X 28 COLE, Jason 20/05/2017 X X X X X 29 COLLIER, Matthew 17/05/2017 X X X X X 30 COLLINS, Sherrie 24/06/2017 X X X X X 31 COLLINS, Tamara 19/06/2017 X X X 32 CUNNINGHAM, Leanne 6/04/2017 X X X X X 33 DAVETANIVALU, Seruwaia 16/06/2017 X X X X X 34 DAVEY, Alan 2/06/2017 X X X 35 DIGBY, David 7/04/2017 X X X X X 36 DODD, Christopher 28/07/2017 X X X 37 DOUGLAS, Brooke 5/05/2017 X X X X X 38 DUDLEY, Kevin 23/06/2017 X X X X X 39 ETZLER, Kym 14/07/2017 X X X X X 40 GAMAGE, Ross 9/06/2017 X X X X X 41 GARROD, Matthew 23/05/2017 X X X X X 42 GATHERCOLE, Tiffany 5/05/2017 X X X X X 43 GIBSON, Trevor 12/05/2017 X X X X X 44 GOODMAN, Belinda 4/04/2017 X X X X X 45 HALL, Krystal 14/07/2017 X X X X X 46 HAMILTON, Graeme 8/04/2017 X X X X X 47 HAMPER, Sammy-Jo 5/07/2017 X X X X X 48 HANINGTON, Nicole 6/05/2017 X X 49 HARDMAN, Renee 1/06/2017 X X X 50 HAYWARD, William 5/04/2017 X X X X X 51 HICKLING, Clarissa 13/04/2017 X X X X X 52 HILL, Danielle 15/07/2017 X X 53 HOHEPA, Israel 5/04/2017 X X X X X 54 HOWARD, Andrew 16/07/2017 X X X X X 55 HUDSON, Miranda 14/07/2017 X X X X X 56 HUDSON, Wade 11/05/2017 X X X X X 57 HURLEY, David 1/06/2017 X X X X X 58 HUTCHINSON, Jaclyn 11/05/2017 X X 59 INALL, Kirsty 26/05/2017 X X X X X 60 IRWIN, Rikki 5/06/2017 X X X X X 61 JAGARA, Wesere 11/04/2017 X X X X X 62 JOHNSON, Pauline 8/06/2017 X X X 63 JONES, Katholine 9/06/2017 X X X 64 KAIN, Jarrod 2/06/2017 X X X 65 KEEN, Michael 9/06/2017 X X X 66 KENNEDY, Janeen 13/06/2017 X X X X X 67 KING, Khandisha 12/04/2017 X X X X X 68 KOSTINEK, Larree 5/06/2017 X X X X X 69 LATIMORE, Ashliegh 1/06/2017 X X X X X 70 LEINASARS, Lynda 1/03/2017 X X X X X 71 LITZOW, James 4/05/2017 X X X X X 72 LORD, Maureen 14/06/2017 X X X 73 LOWEB, Asheligh 12/05/2017 X X X X X 74 LUCAS, Angel 9/05/2017 X X X X X 75 LYNES, Samantha 15/05/2017 X X X X X 76 MACKIE, Tracey 23/06/2017 X X X X X 77 MAIDEN, Jodie 12/04/2017 X X X X X 78 MANNIX, Rachel 5/04/2017 X X X 79 MCCARTHY, Kristy 24/05/2017 X X X X X 80 MCDONNELL, Gordon 12/04/2017 X X X X X 81 MCGREGOR, Nicole 14/06/2017 X X X X X 82 MCINTYRE, Priscilla 6/07/2017 X X X X X 83 MCKENNA, Kimberlea 6/04/2017 X X X X X 84 MEALING, James 7/04/2017 X X X X X 85 MITCHELL, Kylie 27/04/2017 X X X X X 86 MOOKA, Talita 8/06/2017 X X X X X 87 MOTUGA, Katrina 4/05/2017 X X X 88 MUCHINDU, Matildah 14/07/2017 X X X X X 89 MYKYTYSCHYN, Belinda 15/05/2017 X X X X X 90 NAUDE, Lance 14/07/2017 X X X X X 91 NEEDHAM, Michael 12/06/2017 X X X X X 92 OMERHODZIC, Adnan 3/03/2017 X X X X X 93 O'RILEY, Kathryn 5/05/2017 X X X X X 94 PAEKAU, Rangitiaho 12/04/2017 X X X X X 95 PALMER, Andrew 4/05/2017 X X 96 PASCOE, Betty 12/06/2017 X X X 97 PAYNE, Missy 7/07/2017 X X X X X 98 PEEMUGGINA, Harold 26/06/2017 X X X X X 99 PIANTA, Tegan 29/06/2017 X X X X X 100 PICK, Sharon 27/04/2017 X X X X X 101 POLLARD, Anna 8/06/2017 X X X X X 102 POUTAMA, Moana 2/06/2017 X X 103 POWELL, Jason 12/04/2017 X X X X X 104 QARANIQIO, Salome 11/08/2017 X X X X X 105 RICHARDSON, James 18/05/2017 X X X X X 106 ROBERTSON, Sheree 8/05/2017 X X 107 ROBINSON, Antony 2/03/2017 X X X X X 108 ROSE, Marnie 14/06/2017 X X X 109 ROSSITER, Alina 14/07/2017 X X X X X 110 ROWLEY, Kylie 3/05/2017 X X X 111 RUEHE, Andrew 4/05/2017 X X X X X 112 RYAN, Bradley 26/05/2017 X X X 113 RYAN, Jefferson 19/06/2017 X X X X X 114 SCHMIDT, Lagise 4/04/2017 X X X 115 SCOTT, Vanessa 25/05/2017 X X X X X 116 SHEPPARD, Kylie 15/05/2017 X X X X X 117 SHIELL, Glenn 5/04/2017 X X X X X 118 SLAATS, Brett 9/05/2017 X X X X X 119 SNOW, Julie 27/06/2017 X X X 120 SOLOMAN, Rhonda 3/05/2017 X X X X X 121 STOCKHAM, Samantha 16/06/2017 X X X 122 TANGIMAMA, Teokotai 2/05/2017 X X X X X 123 TAYLOR, Eric 25/05/2017 X X X 124 TERVIT, Nicholas 13/04/2017 X X 125 THOMAS, Peter 27/04/2017 X X X X X 126 TOGO, Mellacon 19/05/2017 X X X X X 127 TOWERS, Tammy and Candy 12/04/2017 X X X 128 TURNER, Maria & Mervyn 4/05/2017 X X X X X 129 VALENTINE, Christopher 6/09/2017 X X X X X 130 WALLACE, Angela 5/04/2017 X X X X X 131 WARD, Thomas 16/05/2017 X X X X X 132 WATERMAN, Andrew 17/05/2017 X X X X X 133 WATSON, Mikayla 12/04/2017 X X 134 WEIR, Jason 11/04/2017 X X X X X 135 WELLS, Sonia 21/04/2017 X X X X X 136 WILLIAMSON, Amy 9/05/2017 X X X X X 137 WILSHIRE, Martin 9/06/2017 X X X X X 138 WILSON, David 21/07/2017 X X X 139 WOLFE, Beau 8/05/2017 X X X X X 140 WONG KEE, Esther 5/05/2017 X X X 141 WORTLEY, Rhonda 6/07/2017 X X X X X 142 WRIGHT, Daniel 4/05/2017 X X X Total 2017 Credit Contracts 108 108 142 142 133

Second Tranche of Contracts (2018 Credit Contracts) A B C D E No. Consumer Name Date of Contract s32A s23(1) s17(4) s17(5) ss12DA, DB(1)(a) & (g) 1 ABRAHAM, Dorinda 5/06/2018 X X X X X 2 ABRAHAMS, Luke 6/06/2018 X X X X X 3 ANDREWS, Sarah 25/05/2018 X 4 ASLAN, Dilhan 8/06/2018 X X X X X 5 BARKER, Michelle 29/05/2018 X X X 6 BELL, Gary 30/05/2018 X 7 BELLAROSE, Justine 31/05/2018 X 8 BENTLEY, Crystal 7/06/2018 X X X X X 9 BEVAGE, Melinda 8/06/2018 X X X 10 BEVAGE, Melinda 8/06/2018 X X X X X 11 BEZERRA, Jose 30/05/2018 X X 12 BLIGH, Alexandria 8/06/2018 X X X X X 13 BRANNIGAN, Emma 30/05/2018 X 14 BUCHANAN, Raymond 30/05/2018 X 15 BURNS, Justin 2/06/2018 X X X 16 CROWLEY, Natasha 8/06/2018 X X X X X 17 CUNNINGHAM, Antashia 31/05/2018 X X X X X 18 DAVID, Lily 1/06/2018 X X X X X 19 DODD, Joanne 4/06/2018 X X X X X 20 EDGERTON, Clinton 28/05/2018 X 21 FAIFALE, Nelli-Anne 28/05/2018 X 22 FERGUSON, Monique 6/06/2018 X 23 FITZSIMMONS, Philip 8/06/2018 X X X X X 24 FRAIL, Trae 8/06/2018 X X X 25 FULTON, Lynette 6/06/2018 X X X X X 26 GARLETT, Grace 31/05/2018 X X X X X 27 GORDON, Krystal 18/06/2018 X 28 GOVINDARAJ, Suba 7/06/2018 X 29 GRATY, Kirsty 30/05/2018 X X X X X 30 GRIFFIN, Daniel 4/06/2018 X X X X X 31 GROVES, Brett 5/06/2018 X 32 HAMILTON, Dorothy 8/06/2018 X X X X X 33 HART, Rona 1/06/2018 X X X X X 34 HERN, Sarah 25/05/2018 X 35 HINGA, Hosea 14/06/2018 X 36 HINRICHS, Stefanie 29/05/2018 X 37 HOOKER, Shawn 28/05/2018 X X X X X 38 HUTCHINSON, Garry 29/05/2018 X X X X X 39 INGRAM, Penelope 29/05/2018 X 40 ISUA, Abraham 1/06/2018 X X X X X 41 JARVIS, Ty 30/05/2018 X 42 JOHNS, Tarrin 7/06/2018 X 43 JOHNSON, Leanne 8/06/2018 X X X X X 44 JOHNSON, Mikayla 28/05/2018 X 45 KARGER, Shaun 31/05/2018 X 46 Kerry, Felix 31/05/2018 X 47 LATA, Angeline 4/06/2018 X 48 LAUGINGOA, Tiulipe 4/06/2018 X 49 LEFROY, Kristy 7/06/2018 X X X X X 50 LOW, Bryce 30/05/2018 X 51 MASON, Trent 28/05/2018 X X X 52 MATTHEWS, John 5/06/2018 X 53 MATTHEWS, Leesa 8/06/2018 X 54 MCCULLOUGH, Simmone 28/05/2018 X 55 MCGRADY, Paige 30/05/2018 X 56 MCGREGOR, Shane 31/05/2018 X X X X X 57 MCMAHON, Peter 3/06/2018 X 58 MEAFOU, Bob 8/06/2018 X X X 59 MEECHAN, Amanda 6/06/2018 X X X X X 60 MERRITT, Richelle 14/06/2018 X 61 MILLER, Ryan 1/06/2018 X 62 MILLS, Jennifer 8/06/2018 X X X X X 63 MUNCHOW, Julie 5/06/2018 X 64 NUGENT, Shay 8/06/2018 X 65 O'NEILL, Sam 29/05/2018 X X X X X 66 OOSTENDORP, Matthew 4/06/2018 X 67 PAYNE, Cecil 29/05/2018 X 68 PEDDER, Rick 6/06/2018 X X X 69 PERRY, Andrew 31/05/2018 X X X 70 PETTIGREW, Matthew 5/06/2018 X X X X X 71 RILEY, Stuart 7/06/2018 X 72 RODGERS, Tara 1/06/2018 X 73 ROLLINS, Aaron 29/05/2018 X X X 74 SALEVAO, Peter 2/06/2018 X X X 75 SANDS, Emeley 5/06/2018 X 76 SITANILEI, Stanz 6/06/2018 X X X X X 77 STUDT, Karinna 31/05/2018 X X X X X 78 SU'A, Tanlelu 4/06/2018 X 79 TAFE, Emily 4/06/2018 X X X 80 TAVAO, Steve 6/06/2018 X X X X X 81 THOMAS, Ricky 6/06/2018 X 82 THOMPSON, Shantelle 30/05/2018 X 83 TUHEGA, Tracie 6/06/2018 X 84 TULIATU, Nerone 8/06/2018 X X X 85 UELESE, Sekolasitika 30/05/2018 X 86 UPHILL, Jody 7/06/2018 X 87 WHITE, Ashley 30/05/2018 X X X X X 88 WILSON, John 8/06/2018 X 89 WINNELL, Robert 29/05/2018 X 90 WOODBRIDGE, Juanita 5/06/2018 X X X X X Total 2018 Credit Contracts 32 32 45 90 44 TOTAL OF 2017 & 2018 CONTRACTS 140 140 187 232 177

TABLE 2 - CONTRAVENTIONS BY RENT 2 OWN CARS AUSTRALIA PTY LTD IN WHICH TIMOTHY JAMES ROBERTS AND PAUL ANTHONY GREEN WERE KNOWINGLY CONCERNED First Tranche of Contracts (2017 Credit Contracts) A B C D E No. Consumer Name Date of Contract s32A s23(1) s17(4) s17(5) ss12DA, DB(1)(a) & (g) 1 ABBOTT, Adele 7/06/2017 X X X X X 2 ABRAHAMS, Luke 10/06/2017 X X X X X 3 ABSOLOM, Karen 5/04/2017 X X X X X 4 ACTON, Brendan 3/07/2017 X X X X X 5 AERENGA, Tangi 9/06/2017 X X X X X 6 ANSON, Anastasia 9/06/2017 X X X X X 7 ARMSTRONG, Kate 10/05/2017 X X X X X 8 ASPINALL, Mika-Lee & MARTIN, Blair 12/05/2017 X X X X X 9 BALDACCINO, Shannon 21/04/2017 X X X X X 10 BANNERMAN, Kristine 6/06/2017 X X X X X 11 BARTLEY, Robert 5/04/2017 X X 12 BECK, Thomas 7/04/2017 X X X X X 13 BECKINGHAM, Kyle 15/06/2017 X X X X X 14 BERY, Tod 14/06/2017 X X X X X 15 BILLY, Gibson 14/06/2017 X X X 16 BINGE, Belinda 2/05/2017 X X X X X 17 BLACKLER, Warrick 20/04/2017 X X X X X 18 BORG, Andrew 3/05/2017 X X X X X 19 BRAND, Matthew 19/04/2017 X X X X X 20 BROOKES, Lisa 19/04/2017 X X X X X 21 BROWNE, Diane 8/05/2017 X X X X X 22 BUSHBY, Steven 16/05/2017 X X X X X 23 CANZLER, Rick 8/06/2017 X X X X X 24 CARBERRY, Anthony & Nicole 7/04/2017 X X X X X 25 CASTLEDINE, Phillip 10/04/2017 X X X X X 26 CHETWYND, Rhianna 29/05/2017 X X X 27 CHISENGALUMBWE, Ngoza 2/06/2017 X X X X X 28 COLE, Jason 20/05/2017 X X X X X 29 COLLIER, Matthew 17/05/2017 X X X X X 30 COLLINS, Sherrie 24/06/2017 X X X X X 31 COLLINS, Tamara 19/06/2017 X X X 32 CUNNINGHAM, Leanne 6/04/2017 X X X X X 33 DAVETANIVALU, Seruwaia 16/06/2017 X X X X X 34 DAVEY, Alan 2/06/2017 X X X 35 DIGBY, David 7/04/2017 X X X X X 36 DODD, Christopher 28/07/2017 X X X 37 DOUGLAS, Brooke 5/05/2017 X X X X X 38 DUDLEY, Kevin 23/06/2017 X X X X X 39 ETZLER, Kym 14/07/2017 X X X X X 40 GAMAGE, Ross 9/06/2017 X X X X X 41 GARROD, Matthew 23/05/2017 X X X X X 42 GATHERCOLE, Tiffany 5/05/2017 X X X X X 43 GIBSON, Trevor 12/05/2017 X X X X X 44 GOODMAN, Belinda 4/04/2017 X X X X X 45 HALL, Krystal 14/07/2017 X X X X X 46 HAMILTON, Graeme 8/04/2017 X X X X X 47 HAMPER, Sammy-Jo 5/07/2017 X X X X X 48 HANINGTON, Nicole 6/05/2017 X X 49 HARDMAN, Renee 1/06/2017 X X X 50 HAYWARD, William 5/04/2017 X X X X X 51 HICKLING, Clarissa 13/04/2017 X X X X X 52 HILL, Danielle 15/07/2017 X X 53 HOHEPA, Israel 5/04/2017 X X X X X 54 HOWARD, Andrew 16/07/2017 X X X X X 55 HUDSON, Miranda 14/07/2017 X X X X X 56 HUDSON, Wade 11/05/2017 X X X X X 57 HURLEY, David 1/06/2017 X X X X X 58 HUTCHINSON, Jaclyn 11/05/2017 X X 59 INALL, Kirsty 26/05/2017 X X X X X 60 IRWIN, Rikki 5/06/2017 X X X X X 61 JAGARA, Wesere 11/04/2017 X X X X X 62 JOHNSON, Pauline 8/06/2017 X X X 63 JONES, Katholine 9/06/2017 X X X 64 KAIN, Jarrod 2/06/2017 X X X 65 KEEN, Michael 9/06/2017 X X X 66 KENNEDY, Janeen 13/06/2017 X X X X X 67 KING, Khandisha 12/04/2017 X X X X X 68 KOSTINEK, Larree 5/06/2017 X X X X X 69 LATIMORE, Ashliegh 1/06/2017 X X X X X 70 LEINASARS, Lynda 1/03/2017 X X X X X 71 LITZOW, James 4/05/2017 X X X X X 72 LORD, Maureen 14/06/2017 X X X 73 LOWEB, Asheligh 12/05/2017 X X X X X 74 LUCAS, Angel 9/05/2017 X X X X X 75 LYNES, Samantha 15/05/2017 X X X X X 76 MACKIE, Tracey 23/06/2017 X X X X X 77 MAIDEN, Jodie 12/04/2017 X X X X X 78 MANNIX, Rachel 5/04/2017 X X X 79 MCCARTHY, Kristy 24/05/2017 X X X X X 80 MCDONNELL, Gordon 12/04/2017 X X X X X 81 MCGREGOR, Nicole 14/06/2017 X X X X X 82 MCINTYRE, Priscilla 6/07/2017 X X X X X 83 MCKENNA, Kimberlea 6/04/2017 X X X X X 84 MEALING, James 7/04/2017 X X X X X 85 MITCHELL, Kylie 27/04/2017 X X X X X 86 MOOKA, Talita 8/06/2017 X X X X X 87 MOTUGA, Katrina 4/05/2017 X X X 88 MUCHINDU, Matildah 14/07/2017 X X X X X 89 MYKYTYSCHYN, Belinda 15/05/2017 X X X X X 90 NAUDE, Lance 14/07/2017 X X X X X 91 NEEDHAM, Michael 12/06/2017 X X X X X 92 OMERHODZIC, Adnan 3/03/2017 X X X X X 93 O'RILEY, Kathryn 5/05/2017 X X X X X 94 PAEKAU, Rangitiaho 12/04/2017 X X X X X 95 PALMER, Andrew 4/05/2017 X X 96 PASCOE, Betty 12/06/2017 X X X 97 PAYNE, Missy 7/07/2017 X X X X X 98 PEEMUGGINA, Harold 26/06/2017 X X X X X 99 PIANTA, Tegan 29/06/2017 X X X X X 100 PICK, Sharon 27/04/2017 X X X X X 101 POLLARD, Anna 8/06/2017 X X X X X 102 POUTAMA, Moana 2/06/2017 X X 103 POWELL, Jason 12/04/2017 X X X X X 104 QARANIQIO, Salome 11/08/2017 X X X X X 105 RICHARDSON, James 18/05/2017 X X X X X 106 ROBERTSON, Sheree 8/05/2017 X X 107 ROBINSON, Antony 2/03/2017 X X X X X 108 ROSE, Marnie 14/06/2017 X X X 109 ROSSITER, Alina 14/07/2017 X X X X X 110 ROWLEY, Kylie 3/05/2017 X X X 111 RUEHE, Andrew 4/05/2017 X X X X X 112 RYAN, Bradley 26/05/2017 X X X 113 RYAN, Jefferson 19/06/2017 X X X X X 114 SCHMIDT, Lagise 4/04/2017 X X X 115 SCOTT, Vanessa 25/05/2017 X X X X X 116 SHEPPARD, Kylie 15/05/2017 X X X X X 117 SHIELL, Glenn 5/04/2017 X X X X X 118 SLAATS, Brett 9/05/2017 X X X X X 119 SNOW, Julie 27/06/2017 X X X 120 SOLOMAN, Rhonda 3/05/2017 X X X X X 121 STOCKHAM, Samantha 16/06/2017 X X X 122 TANGIMAMA, Teokotai 2/05/2017 X X X X X 123 TAYLOR, Eric 25/05/2017 X X X 124 TERVIT, Nicholas 13/04/2017 X X 125 THOMAS, Peter 27/04/2017 X X X X X 126 TOGO, Mellacon 19/05/2017 X X X X X 127 TOWERS, Tammy and Candy 12/04/2017 X X X 128 TURNER, Maria & Mervyn 4/05/2017 X X X X X 129 VALENTINE, Christopher 6/09/2017 X X X X X 130 WALLACE, Angela 5/04/2017 X X X X X 131 WARD, Thomas 16/05/2017 X X X X X 132 WATERMAN, Andrew 17/05/2017 X X X X X 133 WATSON, Mikayla 12/04/2017 X X 134 WEIR, Jason 11/04/2017 X X X X X 135 WELLS, Sonia 21/04/2017 X X X X X 136 WILLIAMSON, Amy 9/05/2017 X X X X X 137 WILSHIRE, Martin 9/06/2017 X X X X X 138 WILSON, David 21/07/2017 X X X 139 WOLFE, Beau 8/05/2017 X X X X X 140 WONG KEE, Esther 5/05/2017 X X X 141 WORTLEY, Rhonda 6/07/2017 X X X X X 142 WRIGHT, Daniel 4/05/2017 X X X Total 2017 Credit Contracts 108 108 142 142 133

Second Tranche of Contracts (2018 Credit Contracts) A B C D E No. Consumer Name Date of Contract s32A s23(1) s17(4) s17(5) ss12DA, DB(1)(a) & (g) 1 ABRAHAM, Dorinda 5/06/2018 X 2 ABRAHAMS, Luke 6/06/2018 X 3 ANDREWS, Sarah 25/05/2018 X 4 ASLAN, Dilhan 8/06/2018 X 5 BARKER, Michelle 29/05/2018 X 6 BELL, Gary 30/05/2018 X 7 BELLAROSE, Justine 31/05/2018 X 8 BENTLEY, Crystal 7/06/2018 X 9 BEVAGE, Melinda 8/06/2018 X 10 BEVAGE, Melinda 8/06/2018 X 11 BEZERRA, Jose 30/05/2018 X 12 BLIGH, Alexandria 8/06/2018 X 13 BRANNIGAN, Emma 30/05/2018 X 14 BUCHANAN, Raymond 30/05/2018 X 15 BURNS, Justin 2/06/2018 X 16 CROWLEY, Natasha 8/06/2018 X 17 CUNNINGHAM, Antashia 31/05/2018 X 18 DAVID, Lily 1/06/2018 X 19 DODD, Joanne 4/06/2018 X 20 EDGERTON, Clinton 28/05/2018 X 21 FAIFALE, Nelli-Anne 28/05/2018 X 22 FERGUSON, Monique 6/06/2018 X 23 FITZSIMMONS, Philip 8/06/2018 X 24 FRAIL, Trae 8/06/2018 X 25 FULTON, Lynette 6/06/2018 X 26 GARLETT, Grace 31/05/2018 X 27 GORDON, Krystal 18/06/2018 X 28 GOVINDARAJ, Suba 7/06/2018 X 29 GRATY, Kirsty 30/05/2018 X 30 GRIFFIN, Daniel 4/06/2018 X 31 GROVES, Brett 5/06/2018 X 32 HAMILTON, Dorothy 8/06/2018 X 33 HART, Rona 1/06/2018 X 34 HERN, Sarah 25/05/2018 X 35 HINGA, Hosea 14/06/2018 X 36 HINRICHS, Stefanie 29/05/2018 X 37 HOOKER, Shawn 28/05/2018 X 38 HUTCHINSON, Garry 29/05/2018 X 39 INGRAM, Penelope 29/05/2018 X 40 ISUA, Abraham 1/06/2018 X 41 JARVIS, Ty 30/05/2018 X 42 JOHNS, Tarrin 7/06/2018 X 43 JOHNSON, Leanne 8/06/2018 X 44 JOHNSON, Mikayla 28/05/2018 X 45 KARGER, Shaun 31/05/2018 X 46 Kerry, Felix 31/05/2018 X 47 LATA, Angeline 4/06/2018 X 48 LAUGINGOA, Tiulipe 4/06/2018 X 49 LEFROY, Kristy 7/06/2018 X 50 LOW, Bryce 30/05/2018 X 51 MASON, Trent 28/05/2018 X 52 MATTHEWS, John 5/06/2018 X 53 MATTHEWS, Leesa 8/06/2018 X 54 MCCULLOUGH, Simmone 28/05/2018 X 55 MCGRADY, Paige 30/05/2018 X 56 MCGREGOR, Shane 31/05/2018 X 57 MCMAHON, Peter 3/06/2018 X 58 MEAFOU, Bob 8/06/2018 X 59 MEECHAN, Amanda 6/06/2018 X 60 MERRITT, Richelle 14/06/2018 X 61 MILLER, Ryan 1/06/2018 X 62 MILLS, Jennifer 8/06/2018 X 63 MUNCHOW, Julie 5/06/2018 X 64 NUGENT, Shay 8/06/2018 X 65 O'NEILL, Sam 29/05/2018 X 66 OOSTENDORP, Matthew 4/06/2018 X 67 PAYNE, Cecil 29/05/2018 X 68 PEDDER, Rick 6/06/2018 X 69 PERRY, Andrew 31/05/2018 X 70 PETTIGREW, Matthew 5/06/2018 X 71 RILEY, Stuart 7/06/2018 X 72 RODGERS, Tara 1/06/2018 X 73 ROLLINS, Aaron 29/05/2018 X 74 SALEVAO, Peter 2/06/2018 X 75 SANDS, Emeley 5/06/2018 X 76 SITANILEI, Stanz 6/06/2018 X 77 STUDT, Karinna 31/05/2018 X 78 SU'A, Tanlelu 4/06/2018 X 79 TAFE, Emily 4/06/2018 X 80 TAVAO, Steve 6/06/2018 X 81 THOMAS, Ricky 6/06/2018 X 82 THOMPSON, Shantelle 30/05/2018 X 83 TUHEGA, Tracie 6/06/2018 X 84 TULIATU, Nerone 8/06/2018 X 85 UELESE, Sekolasitika 30/05/2018 X 86 UPHILL, Jody 7/06/2018 X 87 WHITE, Ashley 30/05/2018 X 88 WILSON, John 8/06/2018 X 89 WINNELL, Robert 29/05/2018 X 90 WOODBRIDGE, Juanita 5/06/2018 X Total 2018 Credit Contracts 0 0 0 90 0 TOTAL OF 2017 & 2018 CONTRACTS 108 108 142 232 133