Former Queensland firm sued for unlicensed credit activity

The Australian Securities and Investments Commission (ASIC) has commenced civil penalty action in the Federal Court of Australia against GoGetta Equipment Funding (GoGetta) – a subsidiary of commercial finance company SIV Capital Ltd.

The corporate regulator alleged that the Queensland-based equipment funder engaged in unlicensed credit activity.

Specifically, the regulator alleged that between 30 April 2015 and 9 December 2016, GoGetta entered into 10 rental agreements with consumers who leased motor vehicles “wholly or predominantly for a personal, domestic or household purpose”.

According to ASIC, GoGetta did not obtain a declaration from any of the consumers that the vehicle was hired for business purposes.

The regulator stated that each of the rental agreement were “consumer leases”, in which Part 11 of the National Credit Code applied.

Accordingly, ASIC has accused GoGetta of contravening sections 29 and 32 of the National Credit Act because it did not hold a credit licence, which would have authorised it to enter into the rental agreements and charge the consumer fees.

The corporate watchdog stated that by engaging in unlicensed credit activity, consumers were not afforded with protections under the National Credit Act, which include the right to access hardship assistance and to make complaints to an external dispute resolution (EDR) scheme.

ASIC’s action also includes the acceptance of a Court Enforceable Undertaking from SIV Capital Ltd and GoGetta to ensure affected customers are remediated.

ASIC noted that the maximum penalty for a single contravention of each of sections 29 and 32 of the National Credit Act was $1.8 million prior to 30 July 2015 and $2.1 million prior to 30 June 2017.

GoGetta ceased accepting applications from customers from 6 October 2017 and has not entered into any new motor vehicle leases from 28 February 2018.

On 28 February 2018, SIV Capital announced that it would exit its entire GoGetta asset financing business and run down the GoGetta business.