AFSA sets strict conditions for A&M Group Pty Ltd

The Australian Financial Security Authority (AFSA) has taken strong regulatory action to impose audit conditions on a registered debt agreement administrator A&M Group Pty Ltd, trading as Debt Negotiators.

The Inspector-General in Bankruptcy, Tim Beresford, highlighted the importance of acting to address poor business practices and protect individuals in financial difficulty.

‘Taking action clearly demonstrates the importance I place on maintaining confidence and integrity in the personal insolvency system’, Mr Beresford said.

In December 2022, Debt Negotiators were fined $650,000 by the Federal Court of Australia for engaging in misleading or deceptive conduct and in undue harassment or coercion against debtors who had missed payments under their debt agreements.

AFSA has imposed conditions on Debt Negotiators, effective from 7 July 2023, including:

• a requirement for Debt Negotiators to engage an external consultant to audit the company’s culture, systems and controls and report the audit findings to the Inspector-General.
• a two-year supervisory period to ensure debtors are treated appropriately and fairly, that will include audits of a sample of debt agreements administered by Debt Negotiators.
• providing information on the Debt Negotiators website explaining how debt agreements work, the implications of a default and how to make a complaint to AFSA.
• notifying the Inspector-General of any changes in key personnel within 6 weeks.

These costs will be met by Debt Negotiators.

‘By imposing these conditions, Debt Negotiators have the opportunity to demonstrate they have improved their practices and are committed to achieving the high level of compliance expected of a registered debt agreement administrator.’ Mr Beresford said.

‘Any failure to adhere to the conditions will result in further regulatory action.’

‘We will monitor their compliance closely in order to ensure the best possible outcome for their clients and creditors.’

Mr Beresford said information sharing is critical to help identify and act against misconduct.

‘An anonymous tip off was the catalyst for action against Debt Negotiators – the initial investigation completed by AFSA led to a referral to ASIC and the commencement of the civil action,’ he said.

‘This outcome demonstrates that we will act on intelligence and tip offs. We will act and we will enforce the law.’

You can report any suspected misuse or wrongdoing via the AFSA website.