Solvar Limited (ASX: SVR), a leading provider of specialist finance, announced that the Federal Court has delivered its judgment in the ASIC proceeding against its subsidiary, Money3 Loans Pty Ltd. The court rejected the majority of claims made by the Australian Securities and Investments Commission (ASIC), finding in favour of ASIC in only a few limited respects. Solvar is a market leading Consumer and Commercial finance company with over 20 years’ experience in Australia and New Zealand, having funded over $3 billion of vehicles and personal loans. The Group leverages technology to provide a seamless application process from a broker, online or directly to the Group.
Stuart Robertson, Chair of Solvar, expressed reassurance that the Court recognised the adequate training and competence of Money3’s staff in conducting credit activities. He also highlighted the Court’s finding that Money3’s internal benchmarks for assessing the suitability of potential customers were appropriate and compliant with responsible lending obligations. The company intends to address the specific findings in favour of ASIC to ensure its teams operate at best practice.
The Court’s findings in favour of ASIC relate to five consumer loans issued between 2019 and 2021. In these instances, Money3’s credit analysts were found to have not made reasonable inquiries or taken sufficient steps to verify the living expenses of the borrowers, based on data in their bank statements. In one instance, the court also found that Money3 failed to make reasonable enquiries about whether the requirements included a request to finance the application fee and broker fee.
Solvar’s Managing Director and CEO, Scott Baldwin, affirmed the company’s commitment to the well-being of its customers and workforce. Solvar is actively engaging with community and consumer groups and participating in industry forums to improve practices and address issues impacting customers. The Court will deliberate in the coming months on potential penalties for Money3 and orders regarding legal costs. Solvar has pledged to keep the market informed of any substantive developments.
