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Yellow Brick Road Finance has changed the way it authorises companies and individuals to offer loan advice after the Australian Securities and Investments Commission (ASIC) raised concerns.
ASIC recently updated its regulatory guide, Do I need an Australian credit licence? (RG 203) to help individuals and entities in the credit industry decide whether they engage in credit activities and whether they need an Australian credit licence.
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Previously, Yellow Brick Road had directly authorised over 100 individuals working in YBR branches as credit representatives.
However, ASIC said the national credit licensing framework also required the brokerage to authorise the companies which operate the branches since they act as intermediaries between the licensee and the consumer.
Since ASIC raised its concerns, Yellow Brick Road has promptly responded and is now in the process of authorising the corporate entities directly under its licence, and those entities can sub-authorise employees or they can be directly appointed under YBR’s credit licence.
ASIC acknowledged the company’s cooperation in responding to the issue.
“It is important for all credit licensees to consider carefully how each party they deal with is authorised or licensed. This helps to ensure that all the parties involved in the loan application process are identified, and also strengthens access to external dispute resolution. These are both important consumer protection aspects of the regime,” a statement from ASIC read.
