National Consumer Credit Protection Act 2009

CHAPTER 3 - RESPONSIBLE LENDING CONDUCT  

PART 3-3 - LICENSEES THAT PROVIDE CREDIT ASSISTANCE IN RELATION TO CONSUMER LEASES  

Division 6 - Prohibition on suggesting, or assisting with, unsuitable consumer leases  

SECTION 146   PROHIBITION ON SUGGESTING, OR ASSISTING WITH, UNSUITABLE CONSUMER LEASES  
Prohibition on suggesting, or assisting with, unsuitable leases

146(1)    
A licensee must not provide credit assistance to a consumer by:

(a) suggesting that the consumer apply for a particular consumer lease with a particular lessor; or

(b) assisting the consumer to apply for a particular consumer lease with a particular lessor;

if the lease will be unsuitable for the consumer under subsection (2).

Civil penalty: 5,000 penalty units.

When the lease will be unsuitable

146(2)    
The lease will be unsuitable for the consumer if, at the time the licensee provides the credit assistance, it is likely that:

(a) the consumer will be unable to comply with the consumer ' s financial obligations under the lease, or could only comply with substantial hardship, if the lease is entered in the period proposed for it to be entered; or

(b) the lease will not meet the consumer ' s requirements or objectives if the lease is entered in the period proposed for it to be entered; or

(c) if the regulations prescribe circumstances in which a consumer lease is unsuitable - those circumstances will apply to the lease if the lease is entered in the period proposed for it to be entered.

146(3)    
For the purposes of paragraph (2)(a), it is presumed that, if the consumer could only comply with the consumer ' s financial obligations under the lease by selling the consumer ' s principal place of residence, the consumer could only comply with those obligations with substantial hardship, unless the contrary is proved.

Information to be used to determine if lease will be unsuitable

146(4)    
For the purposes of determining under subsection (2) whether the lease will be unsuitable, only information that satisfies both of the following paragraphs is to be taken into account:

(a) the information is about the consumer ' s financial situation, requirements or objectives, or any other matter prescribed by the regulations under paragraph 140(1)(d) or (e);

(b) at the time the licensee provides the credit assistance:

(i) the licensee had reason to believe that the information was true; or

(ii) the licensee would have had reason to believe that the information was true if the licensee had made the inquiries or verification under section 140 .

Consumer lease not unsuitable under regulations

146(5)    
The regulations may prescribe particular situations in which a consumer lease is taken not to be unsuitable for a consumer, despite subsection (2).

Offence

146(6)    

A person commits an offence if:

(a) the person is subject to a requirement under subsection (1); and

(b) the person engages in conduct; and

(c) the conduct contravenes the requirement.

Criminal penalty: 2 years imprisonment.