However, be particular that you ask all pertinent questions that you have in mind, right after you get through. You could compare unusual options you have and make a smart decision, as soon as you have our replies from your shortlist. Amenda, is tied with Payday Loans after my marriage ended. I had resigned when I was pregnant with my youngest child. Um, and at that stage we wasn’t working. ANNA. I had a ‘one year old’, a ‘3 year old’ and a ‘5 year old’. Anna moved to Geelong in regional Victoria 6 years ago to escape living big cost in Sydney and hoping to obtain a home. STEPHEN LONG. I’m not sure.
ANNA.
Since we’re in rental market, um, ‘we’ have moved every year to 3 years since kids are little.
I think kids worked out they’d lived in 9 or 11 special houses. Unexpected bills -from toschool, doctor -pushed her into toredish. STEPHEN LONG. That is interesting right? It was a stretch, she managed to get a modest house to provide stability for her family. Then once again, tired and fraught, made a fateful decision, with bank card maxed out and no bank loan attainable Anna. I researched different options accessible to make out tiny loans and that’s when payday lenders popped up.
At time that they looked at my finances or anything critical to my existence was when I got into bed at 11 dot 30 at night. ANNA. I’ll merely put in an application. Thence when I had a look at it they realised they’ve been a legitimate industry that was regulated. You usually can find some more information about it on this website. I guess when we first saw it I thought they have been possibly illegal. Um, and I’d been turned down for plenty of loans that we thought, Oh, what toheck. Whenever sitting on our own computer at 11 dot 30 at night, s extremely plain simple to do. Gets 5 or 9 minutes and, to my surprise, Know what, I was approved. STEPHEN LONG.
Accordingly the offers kept coming, after she paid back first loan to Nimble.
ANNA.
They send you an email saying, loan’s been repaid, whenever a loan usually was paid off from any of those lenders. Um, thus obvious solution, particularly when they send you a notification saying, Please make out one more, is to click on that and do it all over once again. You’re rather short for your own various bills, as soon as you get out first one and later repayment for that comes out of your next fortnightly pay. On p of that, um, that may sound like a ‘cop out’. I didn’t truly have much choice once they got into it.
Of course aNNA. STEPHEN LONG. Anna was in a payday lending catch 22″. Now look. Repayments are taken out of our own master card by direct debit since our own pay goes in, as name implies.
ANNA.
Well, it meant that shorter term loans were usually paid off on time.
Um, it meant that additional things tumbled down. STEPHEN LONG. Anna got simply over $ 20000 from payday lenders over 8 months, all in little loans of a few hundred dollars every. One way or another, it cost her nearly $ 6000 in fees and charges -at an effective annual interest rate of more than 325 per cent. DIR, FINANCIAL COUNSELLING AUST. That said, you get first loan and you get second loan and you get third loan to pay off second loan. On p of this, the whole business model relies on trapping people in debt.
FIONA GUTHRIE.
He’s a typical shortterm target money lenders.
About 1000 kilometres north of Geelong, amid Waterloo tenements in Sydney, lives Robert Grant Porter. STEPHEN LONG. It could’ve been so special. This has been tocase. He’d simply ended his apprenticeship when tragedy struck. I was in a coma for 23 months or something. So, rOBERT PORTER. All in all, in 1983 they had a car accident up in Armidale. He had to make a habit to walk once again. For instance, they came at a cost, later on happier times arrived. Brain trauma from accident left Robert permanently disabled. STEPHEN LONG. For instance, I thought, Well, we’re on topension. ROBERT PORTER. We’ll choose it. When were getting married back in City Finance were advertising they’d lend you money and on bottom was pensioners welcome. Ah.
STEPHEN LONG.
All up, it ok less than 3 hours to get $ 1000 for towedding.
Basically the money paid for booze and toband. It was an outdoor wedding. Merely as preacher started saying tovows, sun came out. Oftentimes beautiful. Basically, well, it was raining, after that, it stopped raining since we got married. ROBERT PORTER. On p of that, sTEPHEN LONG. Remember, marriage didn’t last but debts did? Then, rOBERT PORTER. Generaly, yeah, that’s real. Yeah, it did, that’s right -and continues. Up to 3 grand day / Too simple. There is some more information about this stuff on this site. CITY FINANCE AD JINGLE. Basically, similar?. Same phone number? Furthermore, rOBERT PORTER. While leaving Robert without enough for living expenses, loan repayments ok up about a third of his meagre income and money came out of his bank card since his pension went in.
STEPHEN LONG.
You just didn’t think about it.
Smokes, beer, entertainment, clothes. ROBERT PORTER. STEPHEN LONG. Your own beer and your smokes but in addition health basics -food and clothing -were sophisticated to afford once that money had gone out on payday loans? You, that’s. Have you heard about something like that before? Oh. With that said, rOBERT PORTER. Yeah, yeah, yeah. You don’t think about it, as they said. You merely seek for tomoney. Now look, the man who founded City Finance franchise, Bill Brownlee Smith, lived essence at spectrum another end.
STEPHEN LONG.
His luxury yacht, Inspiration, cost nearly $ two million.
At time Robert Porter was taking out his first loan with City Finance, BrownleeSmith called this mansion on Gold Coast home. It’s an interesting fact that the ‘Brownlee Smiths’ maintain City Finance has oftentimes been a responsible lender. Were you aware that, while you were taking out these payday loans, man behind this company was leading a lavish health with multi million dollar Gold Coast property? STEPHEN LONG. ROBERT PORTER. That little prick. Nah. Then, is that right? It was a chance conversation at pub that decisively helped Robert to escape debt spiral. Robert’s regional is Abbotts Hotel, down way from Housing Commission wers of Redfern and Waterloo. You should get this seriously. STEPHEN LONG. STEPHEN LONG. It’s awrite. Oh, look, Know what, I thought that was pretty clear.
STEPHEN LONG.
Phil Johns is always international CEO Credit Providers Association, that represents payday lenders.
He said it should not assume to anyone that fiscal Counselling Australia’s funding be withdrawn. Payday lenders accuse fiscal counsellors of unfairly sullying toindustry’s name. Yes, that’s right! Why does payday lending business have this particular poor reputation? You should get this seriously. PETER CUMINS. Needless to say, in my view, it’s being that consumer activists make quite horrible examples and promulgate those as though as though that’s what happens in each case. STEPHEN LONG. Some amount of pecuniary concerns counsellors are probably backed by a new ASIC report. Nearly 2 thirds were highly going to breach responsible lending laws. More than half gave loans to people who again had multiple loans. It looked at 288 files from lenders covering market threequarters. 9 per cent gave a brand new loan to someone in default. Besides, completely one lender had evidence to justify why they’d approved toloans. PETER KELL, DEPUTY CHAIR.
When we’re talking about vulnerable consumers on extremely lower incomes, that’s not good enough. We’re not getting a clear message as to why they think, in a great deal of circumstances, it’s right thing to do to provide further credit. At Odyssey House in Melbourne, pecuniary counsellor Garry Rothman helps recovering drug addicts get back on track. On p of that, sTEPHEN LONG. GARRY ROTHMAN, FINANCIAL COUNSELLOR, ODYSSEY HOUSE. That is interesting right? We’ve got a couple of debts waived. Day he’s meeting a junior man who we’ll call Max. However, sTEPHEN LONG., without a doubt, gARRY ROTHMAN. Max, to, debt that you had with Nimble is referred to a debt collector and I’ve written to them., sTEPHEN LONG. Max was always a recovering heroin addict who likewise suffers bipolar disorder. Now wholesome, free of drugs and intending to university, he’s still plagued by payday loan debts from when he was using, in 2013. I started resorting to payday lenders to, to fund my addiction.
MAX.
.
I was virtually rather sick at that point in my whole existence with, um, addiction and mental health problems. My lowest in we was homeless. I was, ah, either sleeping in my car or li living in boarding houses and, um, I felt that existence was so miserable that -and, and hopeless and they didn’t see a way out -that it was, it was an every day sort of mission or struggle to blackish myself out every day. With that said, I’d get a payday loan and it should be gone. Thus. However, I was spending… about $ 200 a day on heroin. You see, sTEPHEN LONG. In active addiction, Max ran up thousands of dollars on payday loans and pawnbroker loans. Keep reading. After that, went to another counter, sort of wards shop front, and I got a payday loan from them also.
I went to, um, Cash Converters and we hocked plenty of my items for, for money.
And.
Of course we was struggling financially andand desperate. MAX., sTEPHEN LONG. You just walked up to another counter and they gave you a payday loan? They ok our own goods. Of course they understood you were absolutely desperate for money. STEPHEN LONG. Essentially, it doesn’t look quite good when someone who’s addicted to heroin and in pecuniary distress is pawning their goods at one counter and getting a payday loan at another. I recognize. They don’t all in all come in and declare that to staff member. PETER CUMINS. You’ve got to be advised that a staff member can’t be expected to see whether somebody is a heroin addict or not. Think for a moment. GARRY ROTHMAN. Max’s situation was always one that we see every now and then. Remember, ah, our experience has been that probably 80 per cent of people who always were living an essence like him should have payday loans.
GOOD2GO WEBSITE PROMOTIONAL VIDEO. She needs cash now. STEPHEN LONG. Good2Go Loans is a breakaway from City Finance and it apparently sees drug addiction as no barrier to getting a loan. Basically, 4 Corners met with a whistleblower from Good2Go Loans who revealed this practices payday lender. Now please pay attention. To Essentially, gOOD2GO WHISTLEBLOWER. Someone would come in and you may see that they’re visibly affected by drugs. I mean, you may see it in their eyes. It’s way they stand and they slur their speech. That’s right! They’ve got their ID and they’ve got their bank statements with them.
They should get in all good documentation. It’s prepared for you to go. My concern is always that this person has been affected by drugs, To be honest I would approach my supervisor and we would say, the loan stacks up. So, don’t worry about it. Write it up, as long as loan stacks up., without any doubts, they my be told. Still, they get a loan. I I’ did have someone come in and they had multiple payday loans with different lenders and it’s clear that they’re, they have a gambling issue as long as there usually were online gambling payments on their bank statements. I’ve had to show them letters to type in to write, Know what, I accept. Commonly. Yep, Know what, I still wrote toloan. I’ve had people come in who were usually illiterate. Then, how are you? Essentially, hi, that’s Tracy calling from Good2Go Loans. GOOD2GO LOANS EMPLOYEE. Although, sTEPHEN LONG. In a disturbing revelation, insiders ld 4 Corners that Good2Go routinely reviewing contracts after they’ve been signed -and we’ve seen evidence of this. Notice that sidestepping caps on fees, good2Go signs people up to 3 year loan deals that aren’t regulated by governmental laws.
It’s a baitandswitch. While outlining a really new payment plan, it sends customer a text message. Credits might be settled within next 24hrs. Known dear Andrew Acceptance received. Now please pay attention. SMS MESSAGE. Our own payments are $ 72 fortnightly with first payment 03/02/Any questions please call G2G Loans. We send them a SMS saying their modern loan repayment amount. One way or another, and, you understand, they’re hoodwinked. GOOD2GO WHISTLEBLOWER. Well, loan contract will say that toloan’s for 104 weeks. Consequently 99 per time cent that doesn’t happen. I’m quite sure I accept, we rethink it on them, if they email back saying. They might’ve signed a contract saying that they’ve been intending to repay $ seven or $ ten a fortnight.
They possibly miss payments, they weren’t expecting that kind of repayment, payments will bounce and come a whole range of dishonour fees.
STEPHEN LONG.
Whether you a solution or not, a $ seven charge per call; $ 27 dot 50 to send a letter to toclient; and a $ 50 direct debit fee for taking money from your account, multiple fees involve a $ seven charge for sending a client a text message. We raised our concerns with ASIC’s deputy chairman. They’ve charged $ 250 as an establishment fee -that’s 50 per cent of loan cost. You will see there. I’d like to show you a contract from a company called Good2Go Loans. It’s a ‘rather short term’ loan, we’ve been ld by insiders that in virtually all cases loan has probably been written as being 104 weeks and immediately repayments have always been changed, they are purporting that this loan usually was as long as we obviously don’t need to see people attempting to game torules, either by manipulating loan length or by manipulating sorts of fees and charges that, um, ah, that people have to pay, including establishment fee.
PETER KELL.
STEPHEN LONG.
Are there dodgy players in toindustry? You see, pETER CUMINS. I think there was over topast. Have been there still dodgy players in toindustry? STEPHEN LONG. STEPHEN LONG. That said, he said he was not prepared to comment at this stage, we tried to speak to Mr Bousfield. Good2Go CEO Loans, Jason Bousfield, has probably been on board of international board Credit Providers’ Association, peak body for payday lenders. After been alerted by our Corners. Oftentimes at ASIC’s headquarters in Sydney, there’s a whole team cracking down on payday lenders -but it’s like game like regulatory whackamole. Another pops up, whenever it knocks down one scam. Commonly, pETER KELL. On p of that, that they will charge a higher price to plenty of to most vulnerable members of our community, to get around caps on fees where they have existed, ah, payday history lending industry was always, unfortunately, a history of lenders who have tried by whatever means doable to get around consumer protections that been in place.
She’s a pensioner who lives near Penrith in far western Sydney. Julie’s got 3 kids and a tribe of doting grandchildren. She’s as well lead plaintiff in class action litigation against Cash Converters. STEPHEN LONG. Now regarding aforementioned fact… STEPHEN LONG. Payday lending giant could have been forced to compensate more than 50000 people like her, So if it succeeds. Anyways, while having to go and get loan after loan, Well, I’m doing it therewith for myself but So there’s lots of people out there, I suppose, that are in identical situation as I am, that got caught up in the spiral thing. JULIE GRAY. She spends up a vast chunk of a short income on medicine and medic bills. Julie battles ill health. Anyways, sTEPHEN LONG. Now pay attention please. After my rent and.. Which. Um, um, electricity and bills and that are paid, I believe I’m left with $ 320. Surely, jULIE GRAY. I’ve got a hip specialist that we search for. Then once more, sTEPHEN LONG.
Julie Gray can’t remember what first ok her to Cash Converters at Penrith.
That was probably her intention, when Julie Gray went into Penrith Cash Converters store to take up $ 100.
BEN SLADE, LAWYER, MAURICE BLACKBURN. It’s highly shortly after that that instalments that she makes out of her visa card leave her with nothing. One way or another, she needs to go back in and get another $ 100 and hereupon a special loan for $ it’s quite shortly after that she needs to go back in and get another $ 100 cash loan and another special loan. Needless to say, consequently over and over again and more and more and, until she’s searched for herself in an impossible situation.
STEPHEN LONG. At totime, maximum payday lenders could charge customers in newest South Wales was 48 per cent a year, including all fees and charges. What Julie didn’t understand was that she was correctly paying Cash Converters more than 13 times that limit. It is bEN SLADE. Betwixt 2010 and 2013, there was a 48 per cent maximum annual percentage rate cap in NSW. In reality, we’ve got 3 class actions that we’re running that allege that Cash Converters avoided that cap by a mechanism that was, we say. STEPHEN LONG. Julie, that’s one of the loan documents from Cash Converters. STEPHEN LONG. Actually a mechanism related to loan switch Good2Go now employs. Furthermore, for cash loans, if they had included it, it was 633 per cent per annum and for private loans it was 145 per cent per annum.
BEN SLADE.
STEPHEN LONG.
What’s our view on class action being taken against Cash Converters in NSW? Likewise, I personally don’t think their claim has merit. You should get it into account. Ah and that’s my private opinion. Nonetheless, pETER CUMINS. While managing director of Cash Converters transnational Limited, peter Cumins. So, dAVID FAWCETT, SENATOR, CHAIR, PARLIAMENTARY JOINT COMMITTEE ON CORPORATIONS AND FINANCIAL SERVICES. Ok, and now one of most vital parts. In a submission to a Parliamentary committee considering governmental legislation, Cash Converters admitted to avoiding 48 per cent interest rate cap in NSW. STEPHEN LONG. This is where it starts getting highly intriguing. Reality was always that all shorter term lenders have in place mechanisms to ensure that they get a return greater than 48 per cent annualised cap imposes on them. CASH CONVERTERS SUBMISSION. STEPHEN LONG.
So it’s a contract for a cash advance.
Those mechanisms pushed Julie Gray into a spiral of debt and depression.
STEPHEN LONG. Consequently, jULIE GRAY. For instance, I suppose. That is interesting. Truly, when we started. Fact, they don’t understand. I merely felt like, with todepression. I wasn’t worth. A well-reputed fact that is probably. Um, as a parent they was letting my kids down. In any event. I’m sure you heard about this. STEPHEN LONG. How do you feel about Cash conduct Converters? Although, ’cause there will be lots of people out there that must be in really similar boat as what I am, in order to I’m sure you heard about this. JULIE GRAY. I’m disgusted, to be truthful. I’m so pretty old, I actually grew up in weeks when you saved up to obtain something.
What you’ve got to keep in mind, I guess, usually was that lending at, at this level has been a, um, is a symptom, not a cause.
PETER CUMINS.
While working in toindustry, um, bank statement and their spending patterns, it should assume that plenty of people spend everything that they earn, Therefore if you look at somebody’s. STEPHEN LONG. Oftentimes whenever earning enough to save has usually been a distant dream, for lots of who turn to payday lending. It’s a world of ‘povertylevel’ welfare, where people shuffle in and out of insecure jobs. Research shows that most payday loan customers use money to pay for essential needs, just like food and rent. In a lot of ways, payday lending is a product of solutions society has made about how to deal with those in pecuniary hardship.
FIONA GUTHRIE.
Reason that we’re seeing lots of people desperate for payday loans, really lowincome people, has been that our public security safety net is usually so rather low.
If you don’t have enough money, week to week to week, and you have an unexpected expense similar to children going back to school, where do you go? Notice that hi. How were probably you? Nevertheless, gOOD SHEPHERD CUSTOMER SERVICE WORKER. GOOD SHEPHERD CUSTOMER SERVICE WORKER. You’re here for your interview for a ‘step up’ loan? Let me tell you something. All right, will you. GOOD SHEPHERD CUSTOMER SERVICE WORKER. Remember, look, there’re alternatives to lofty cost payday loans. STEPHEN LONG. Then once more, make a seat.
GOOD SHEPHERD CUSTOMER SERVICE WORKER.
5 hundred and fifty solutions nationwide offer no or lowinterest loans through Good Shepherd Microfinance.
STEPHEN LONG. Hi. Notice that it’s Ty from Good Money Store here in Geelong. TY, CUSTOMER SERVICE CALLER. It’s a. Um, it requires some fiscal misfortune, whatever that complex to recover from.
KERRY O’BRIEN.
Westpac has ld 5 Corners it’s reviewing its due diligence in relation to payday lending businesses, in light of ASIC’s critical report. We should note that international Credit Providers’ Association, that represents payday lending industry, refused repeated requests to be interviewed for toprogram. Seriously. I must likewise clarify that Good2Go Loans, that featured in tostory, ain’t connected in any way to a program called Good2GoNow, that is co ordinated by Good Shepherd Microfinance and Good Guys whitegoods retailer. Doesn’t it sound familiar? India’s daughter, documentary a billion Indians have not been helped to watch.
