Cash Converters taken to court over alleged responsible lending breach
The Consumer Action Law Centre has filed a claim in the Federal Circuit Court against payday lender Cash Converters on behalf of a pensioner, alleging that the company failed in its obligation to lend responsibly.CALC claimed that Cash Converters repeatedly offered its client loans over a period of six years, despite being aware that she was a disability support pensioner with a gambling addiction.Over the six years Cash Converters offered the client 63 loans. During that time the pensioner "could not meet repayments without significant hardship."CALC director of legal practice, Jillian Williams, said in a statement: "Lenders have to assess the ability of borrowers to be able to pay the loan. In this case our client alleges Cash Converters only assessed income and ignored significant warning signs."We allege Cash Converters gave repeated loans to a person when it was quite clear the loans were unsuitable."Cash Converters has seen plenty of court action this year. In June it agreed to pay A$20 million (plus $3 million of legal costs) to settle a class action brought by borrowers in New South Wales over fees and charges.A month later it was served with a writ commencing a class action on behalf of borrowers in Queensland over the charging of brokerage fees.