CREDIT INTERMEDIARIES AND
AGENCY
Philip Haultain
Special Counsel
National Australia Bank
Credit Intermediaries and Agency
Purpose
The Nature of Agency
- Consent, authority, fiduciary obligation
- Acts binding ...
Credit intermediaries and agency
 The nature of credit intermediaries
- Finance brokers
- Mortgage Managers
- Referrers
3...
Credit intermediaries and agency
 Credit intermediaries as agents
- NCCP approach
- Finance brokers
* prima facie assumpt...
Credit intermediaries and agency
 Duties of agents
- common law
- NCCP general conduct obligations
 Remuneration
- commo...
Credit intermediaries and agency
 Termination
- common law
- automatic termination under NCCP
ACL holder duties
- effici...
Jon Denovan – Partner, Gadens
Why are referrers potentially regulated?
 A business needs to be licensed
(or appointed as a CR) if it is providing a ‘cr...
Main categories of referrers
 Non-business related referrers
 Business related referrers who do not provide
customer con...
Importance of business origination
 A key customer touch point
 Subsequent ‘information repair’ may be
insufficient to n...
Marketing material
 Content becomes critical
 Example – what is a ‘standard variable rate
loan’?
 Is the rate advertise...
Internet as source of business
 Categorisation of site often hard
 Advertisement v referral
 Click through
 If a refer...
Intermediaries
• Unlicensed and licensed
• Does the second credit
assessment serve any
regulatory purpose?
Intermediaries
Aggregators – the personal touch
Aggregators
Liability to
lenders
Liability to
borrowers
Data
retention
Phil Haultain, Advantedge Financial Services & Jon Denovan, Gadens: Distribution channels and risk
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Phil Haultain, Advantedge Financial Services & Jon Denovan, Gadens: Distribution channels and risk

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Philip Haultain, Head of Legal, Advantedge Financial Services and Jon Denovan, Senior Partner - Banking and Finance, Gadens delivered this presentation at the 2013 Credit Law conference. The event offers key insights from the regulators; thought-provoking sessions from industry leaders; and updates on all the regulatory changes impacting the sector. For more information on the annual event, please visit the conference website: http://www.informalegal.com.au/law-legal-conferences/credit-law-conference

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  • I am Phil Haultain. Will Jon Denovan kindly contact me, via Philhaultain@gmail.com
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Phil Haultain, Advantedge Financial Services & Jon Denovan, Gadens: Distribution channels and risk

  1. 1. CREDIT INTERMEDIARIES AND AGENCY Philip Haultain Special Counsel National Australia Bank
  2. 2. Credit Intermediaries and Agency Purpose The Nature of Agency - Consent, authority, fiduciary obligation - Acts binding the principal - Knowledge imputed to the principal 2 Footer
  3. 3. Credit intermediaries and agency  The nature of credit intermediaries - Finance brokers - Mortgage Managers - Referrers 3 Footer
  4. 4. Credit intermediaries and agency  Credit intermediaries as agents - NCCP approach - Finance brokers * prima facie assumption * Tonto Home Loans v Tavares * Permanent Mortgages v Van den Bergh - Mortgage Managers * Micarone v. Perpetual Trustees * Bartle v GE Custodians * Perpetual Trustees v Schmidt * Interstar cases - Referrers 4 Footer
  5. 5. Credit intermediaries and agency  Duties of agents - common law - NCCP general conduct obligations  Remuneration - common law - section 114 NCCP Footer
  6. 6. Credit intermediaries and agency  Termination - common law - automatic termination under NCCP ACL holder duties - efficiently, honestly and fairly  Credit monitoring review 6 Footer
  7. 7. Jon Denovan – Partner, Gadens
  8. 8. Why are referrers potentially regulated?  A business needs to be licensed (or appointed as a CR) if it is providing a ‘credit service’  A credit service occurs if a person as part of, or incidentally to, a business either:  Provides credit assistance  Acts as an intermediary
  9. 9. Main categories of referrers  Non-business related referrers  Business related referrers who do not provide customer contact details to lenders / brokers  Business related referrers who do provide customer contact details to lenders / brokers  Website referrers  Licensed intermediaries
  10. 10. Importance of business origination  A key customer touch point  Subsequent ‘information repair’ may be insufficient to negate original perceptions
  11. 11. Marketing material  Content becomes critical  Example – what is a ‘standard variable rate loan’?  Is the rate advertised available to all borrowers?  Is the rate a ‘teaser’ rate?  Comparison sites – comparing like with like?
  12. 12. Internet as source of business  Categorisation of site often hard  Advertisement v referral  Click through  If a referral – hard to argue incidental to a business when the service is advertised  Is there a suggestion of a specific contract with a specific lender?
  13. 13. Intermediaries • Unlicensed and licensed • Does the second credit assessment serve any regulatory purpose? Intermediaries
  14. 14. Aggregators – the personal touch
  15. 15. Aggregators Liability to lenders Liability to borrowers Data retention

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