(c) the person’s conduct breaches the requirement.
Criminal penalty: 50 penalty units.
Defences for not giving projections
(3) For the purposes of paragraphs (1)(a) and (b), and of subsection (2) so far as it relates to either of those paragraphs, it is a defence if the licensee reasonably believes that:
(a) another person has:
(i) shown the consumer in person projections described in paragraph (1)(a); and
(ii) given the consumer a printed copy of the projections; and
(b) the projections are the same, or substantially the same, as those paragraph (1)(a) requires the licensee to show the consumer.
Note: For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (3) (see subsection 13.3(3) of the Criminal Code).
(4) For the purposes of paragraphs (1)(a) and (b), and of subsection (2) so far as it relates to either of those paragraphs, it is a defence if the circumstances prescribed by the regulations exist.
Note: For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).
Defence for not giving reverse mortgage information statement
(5) For the purposes of paragraph (1)(d), and of subsection (2) so far as it relates to that paragraph, it is a defence if the licensee reasonably believes that another person has given the consumer a reverse mortgage information statement in the last 90 days.
Note: For the purposes of subsection (2), a defendant bears an evidential burden in relation to the matter in subsection (5) (see subsection 13.3(3) of the Criminal Code).
133DC Making reverse mortgage information statement available on website of credit provider or credit assistance provider
When this section applies
(1) This section applies if a licensee:
(a) is:
(i) a person who provides, or holds himself or herself out as able to provide, credit assistance relating to credit contracts for reverse mortgages; or
(ii) a credit provider under one or more credit contracts for a reverse mortgages; and
(b) has a website that provides information about such contracts.
Requirement
(2) The licensee must make available through the website a reverse mortgage information statement.
Civil penalty: 5,000 penalty units.
Offence
(3) A person commits an offence if:
(a) the person is subject to a requirement under subsection (2); and
(b) the person engages in conduct; and
(c) the person’s conduct breaches the requirement.
Criminal penalty: 50 penalty units.
133DD Making reverse mortgage information statement available in other situations
When this section applies
(1) This section applies if:
(a) a licensee is:
(i) a person who provides, or holds himself or herself out as able to provide, credit assistance relating to credit contracts for reverse mortgages; or
(ii) a credit provider under one or more credit contracts for reverse mortgages; and
(b) either:
(i) a consumer asks the licensee (otherwise than by using a website of the licensee) for a reverse mortgage information statement; or
(ii) the regulations require a consumer, in circumstances prescribed by the regulations, to be given a reverse mortgage information statement; and
(c) the consumer gives the licensee the consumer’s name, and the contact details required by the regulations.
Requirement
(2) The licensee must, in accordance with any requirements prescribed by the regulations, give the consumer a reverse mortgage information statement.
Civil penalty: 5,000 penalty units.
Offence
(3) A person commits an offence if:
(a) the person is subject to a requirement under subsection (2); and
(b) the person engages in conduct; and
(c) the conduct contravenes the requirement.
Criminal penalty: 50 penalty units.
Defences
(4) For the purposes of subsections (2) and (3), it is a defence if:
(a) the licensee has given the consumer, or reasonably believes that someone else has given the consumer, a reverse mortgage information statement; or
(b) the licensee:
(i) is a credit provider under one or more credit contracts for reverse mortgages; and
(ii) reasonably believes that the consumer would not be eligible to make a credit contract with the licensee for a reverse mortgage; or
(c) there exist circumstances prescribed by regulations as circumstances in which the licensee is not required to give the consumer a reverse mortgage information statement.
Note: For the purposes of subsection (3), a defendant bears an evidential burden in relation to the matter in subsection (4) (see subsection 13.3(3) of the Criminal Code).
133DE Representations that use the term “reverse mortgage” etc.
Credit service providers
(1) A licensee must not, in providing or offering to provide a credit service to a consumer, use either of the following terms (either alone or in combination with other words or letters) in a representation to the consumer about an actual or proposed credit contract or mortgage:
(a) the phrase “reverse mortgage”;
(b) another term (whether or not in English) of similar import to the phrase “reverse mortgage”.
Civil penalty: 5,000 penalty units.
Credit providers
(2) A licensee that is a credit provider must not use either of the following terms (either alone or in combination with other words or letters) in a representation to a consumer about an actual or proposed credit contract or mortgage:
(a) the phrase “reverse mortgage”;
(b) another term (whether or not in English) of similar import to the phrase “reverse mortgage”.
Civil penalty: 5,000 penalty units.
Defence
(3) For the purposes of subsections (1) and (2), it is a defence if:
(a) the representation truly represents that a credit contract:
(i) is or will be a credit contract for a reverse mortgage; or
(ii) is not or will not be a credit contract for a reverse mortgage; or
(b) the representation truly represents that a mortgage:
(i) is or will be part of a reverse mortgage; or
(ii) is not or will not be part of a reverse mortgage.
Part 3‑3—Licensees that provide credit assistance in relation to consumer leases
Division 1—Introduction
134 Guide to this Part
This Part has rules that apply to licensees that provide credit assistance in relation to consumer leases. These rules are aimed at better informing consumers and preventing them from being in unsuitable consumer leases. However, these rules do not apply to a licensee that will be the lessor under the consumer lease.
Division 2 requires a licensee to give its credit guide to a consumer. The credit guide has information about the licensee and some of the licensee’s obligations under this Act.
Division 3 requires a licensee to give a quote before providing credit assistance to a consumer. The quote must set out the maximum amount the consumer will be required to pay to the licensee. The licensee must not charge more than that amount.
Division 4 requires a licensee, before providing credit assistance to a consumer in relation to a consumer lease, to make a preliminary assessment as to whether the lease will be unsuitable for the consumer. To do this, the licensee must make inquiries and verifications about the consumer’s requirements, objectives and financial situation. The licensee must give the consumer a copy of the assessment if requested.
Division 5 requires a licensee, when providing credit assistance to a consumer in relation to a consumer lease, to give the consumer a document that discloses certain information (for example, the indirect remuneration the licensee is likely to receive).
Division 6 prohibits a licensee from providing credit assistance to a consumer in relation to a consumer lease if the lease will be unsuitable for the consumer.
Division 7 imposes requirements on a licensee who makes representations about providing credit assistance in relation to consumer leases for household goods. It also imposes requirements in relation to recording the preliminary assessment that a consumer lease is not unsuitable.
135 Application of this Part
This Part does not apply in relation to credit assistance provided by a licensee in relation to a consumer lease if the licensee is or will be the lessor under the consumer lease.
Division 2—Credit guide of credit assistance providers
136 Credit guide of credit assistance providers
Requirement to give credit guide
(1) A licensee must, as soon as practicable after it becomes apparent to the licensee that it is likely to provide credit assistance to a consumer in relation to a consumer lease, give the consumer the licensee’s credit guide in accordance with subsection (2).
Civil penalty: 5,000 penalty units.
(2) The licensee’s credit guide must:
(a) be in writing; and
(b) be in the form (if any) prescribed by the regulations; and
(c) specify the licensee’s name and contact details; and
(d) specify the licensee’s Australian credit licence number; and
(e) give information about:
(i) any fees that are payable by a consumer to the licensee for the licensee’s credit assistance; and
(ii) any charges that are payable by a consumer to the licensee for matters associated with providing the credit assistance; and
(iii) the method for working out the amount of the fees and charges; and
(f) give information about:
(i) if there are 6 or fewer lessors that the licensee conducts business with when providing credit assistance in relation to consumer leases—the names of those lessors; and
(ii) if there are more than 6 lessors that the licensee conducts business with when providing credit assistance in relation to consumer leases—the names of the 6 lessors with whom the licensee reasonably believes it conducts the most business; and
(g) give information about:
(i) any indirect remuneration that the licensee, or an employee, director or credit representative of the licensee, is likely to receive, directly or indirectly, from lessors in relation to consumer leases for which the licensee has provided credit assistance; and
(ii) a reasonable estimate of the amounts of that indirect remuneration or the range of those amounts; and
(iii) the method for working out those amounts; and
(h) give information about the licensee’s procedure for resolving disputes with a consumer, including contact details for a consumer to access:
(i) the licensee’s internal dispute resolution procedure; and
(ii) the AFCA scheme; and
(i) give information about the licensee’s obligations under sections 143 and 146; and
(j) comply with any other requirements prescribed by the regulations.
(3) The regulations may prescribe:
(a) information that need not be included in the credit guide, despite subsection (2); and
(b) for the purposes of paragraph (2)(g):
(i) the method for working out amounts of indirect remuneration; and
(ii) how indirect remuneration or amounts of indirect remuneration must be described.
Manner of giving credit guide
(4) The licensee must give the consumer the licensee’s credit guide in the manner (if any) prescribed by the regulations.
Strict liability offence
(5) A person commits an offence if:
(a) the person is subject to a requirement under subsection (1); and
(b) the person engages in conduct; and
(c) the conduct contravenes the requirement.
Criminal penalty: 50 penalty units.
(6) Subsection (5) is an offence of strict liability.
Note: For strict liability, see section 6.1 of the Criminal Code.
Division 3—Quote for providing credit assistance etc. in relation to consumer leases
137 Quote for providing credit assistance etc.
Requirement to give quote
(1) A licensee must not provide credit assistance to a consumer by:
(a) suggesting that the consumer apply, or assisting the consumer to apply, for a particular consumer lease with a particular lessor; or
(b) suggesting that the consumer remain in a particular consumer lease with a particular lessor;
unless:
(c) the licensee has given the consumer a quote in accordance with subsection (2); and
(d) the consumer has signed and dated that quote or otherwise indicated the consumer’s acceptance of it (and the day that happens) in the manner (if any) prescribed by the regulations; and
(e) the licensee has given the consumer a copy of the accepted quote.
Civil penalty: 5,000 penalty units.
(2) The quote must:
(a) be in writing; and
(b) give information about the credit assistance and other services that the quote covers; and
(c) specify the maximum amount that will be payable by the consumer to the licensee in relation to the licensee’s credit assistance and other services; and
(d) give information about what that amount relates to, including:
(i) the maximum amount of the licensee’s fee for providing the credit assistance and other services; and
(ii) the maximum amount of charges that will be incurred by the licensee for matters associated with providing the credit assistance and other services; and
(iii) the maximum amount of fees or charges that will be payable by the licensee to another person on the consumer’s behalf; and
(e) state whether the maximum amount or any other amount will be payable by the consumer to the licensee if a consumer lease is not entered; and
(f) comply with any other requirements prescribed by the regulations.
Manner of giving quote
(3) The licensee must give the quote to the consumer in the manner (if any) prescribed by the regulations.
No demanding payment of amount exceeding quoted amount
(4) The licensee must not request or demand payment of an amount that exceeds the maximum amount set out in the quote.
Civil penalty: 5,000 penalty units.
No demanding payment before credit assistance provided
(5) The licensee must not request or demand payment of an amount for the licensee’s credit assistance before the licensee provides the assistance.
Civil penalty: 5,000 penalty units.
Caveats
(6) The licensee must not lodge, or threaten to lodge, a caveat in relation to land to induce the consumer to pay an amount to the licensee for the licensee’s credit assistance or other services.
Civil penalty: 5,000 penalty units.
Division 4—Obligations of credit assistance providers before providing credit assistance for consumer leases
138 Obligations of credit assistance providers before providing credit assistance for consumer leases
(1) A licensee must not provide credit assistance to a consumer on a day (the assistance day) by:
(a) suggesting that the consumer apply for a particular consumer lease with a particular lessor; or
(b) assisting the consumer to apply for a particular consumer lease with a particular lessor;
unless the licensee has, within 90 days (or other period prescribed by the regulations) before the assistance day:
(c) made a preliminary assessment that:
(i) is in accordance with subsection 139(1); and
(ii) covers the period proposed for the entering of the lease; and
(d) made the inquiries and verification in accordance with section 140.
Civil penalty: 5,000 penalty units.
(2) A licensee must not provide credit assistance to a consumer on a day (the assistance day) by suggesting that the consumer remain in a particular consumer lease with a particular lessor unless the licensee has, within 90 days (or other period prescribed by the regulations) before the assistance day:
(a) made a preliminary assessment that:
(i) is in accordance with subsection 139(2); and
(ii) covers a period in which the assistance day occurs; and
(b) made the inquiries and verification in accordance with section 140.
Civil penalty: 5,000 penalty units.
139 Preliminary assessment of unsuitability of the consumer lease
(1) For the purposes of paragraph 138(1)(c), the licensee must make a preliminary assessment that:
(a) specifies the period the assessment covers; and
(b) assesses whether the consumer lease will be unsuitable for the consumer if the lease is entered in that period.
(2) For the purposes of paragraph 138(2)(a), the licensee must make a preliminary assessment that:
(a) specifies the period the assessment covers; and
(b) assesses whether the consumer lease will be unsuitable for the consumer if the consumer remains in the lease in that period.
Note: The licensee is not required to make a preliminary assessment under this section if the credit assistance is not provided.
140 Reasonable inquiries etc. about the consumer
(1) For the purposes of paragraph 138(1)(d) or 138(2)(b), the licensee must, before making the preliminary assessment:
(a) make reasonable inquiries about the consumer’s requirements and objectives in relation to the consumer lease; and
(b) make reasonable inquiries about the consumer’s financial situation; and
(c) take reasonable steps to verify the consumer’s financial situation; and
(d) make any inquiries prescribed by the regulations about any matter prescribed by the regulations; and
(e) take any steps prescribed by the regulations to verify any matter prescribed by the regulations.
Civil penalty: 5,000 penalty units.
(1A) If:
(a) the consumer lease is a consumer lease for household goods; and
(b) the consumer holds (whether alone or jointly with another person) an account with an ADI into which income payable to the consumer is credited;
the licensee must, in verifying the consumer’s financial situation for the purposes of paragraph 138(1)(d), obtain and consider information about each transaction on the account, and the balances of the account, during at least the immediately preceding period of 90 days.
(1B) Subsection (1A) does not limit paragraph (1)(c).
(2) The regulations may prescribe particular inquiries or steps that must be made or taken, or do not need to be made or taken, for the purposes of paragraph (1)(a), (b) or (c).
141 When the consumer lease must be assessed as unsuitable—entering lease