Capital Finance Australia, a subsidiary of Westpac, has paid penalties totalling $493,000 after ASIC found that between March and June 2015, the car finance provider failed on 55 occasions to provide customers with default notices prior to commencing enforcement proceedings to repossess mortgaged vehicles.
ASIC also found that Capital Finance failed on three occasions to provide customers with legally-required information setting out their rights and the options available to them within the required time frame after it repossessed mortgaged vehicles.
As a result, consumers were not given information about their legal rights and protections when they were in danger of having their cars repossessed, ASIC said in a statement.
“For example, consumers were not advised that they had 30 days to remedy a default before Capital Finance could commence enforcement proceedings.”
“Consumers were also not advised that they could give notice of their financial hardship to Capital Finance and seek a variation to the repayments.”
ASIC Deputy Chairman Peter Kell said it is crucial that credit providers engage responsibly with consumers who are having difficulty in making their repayments and who may be experiencing financial hardship.
“Having a car repossessed can have a significant impact on a consumer and car financiers must ensure that key information is provided to consumers,” he said.
“ASIC will act against licensees who fail to meet these obligations.”
[Related: ANZ to pay $5 million to customers]