Streetwise strife for FirstMac

FirstMac and its retail arm Tonto Home Loans are the targets in a test case over the enforaecblity of mortgage documents over low documentation home loans.

In a media release on Friday the Australian Securities and Investments Commission said it intervened in proceedings scheduled to be heard in the Supreme Court of New South Wales on 23 March 2009.

The proceedings concern the conduct of the Streetwise Group of Companies and which has been subject to investigation by ASIC, according to the media release.

ASIC said it intervened in three proceedings commenced by Tonto Home Loans Australia Pty Ltd (now Firstmac Limited) and Permanent Trustee Company Ltd seeking to take possession of properties owned by former Streetwise borrowers. The defendants in the three proceedings Tavares & Rowe, Di Benedetto and O'Donnell.

ASIC said in its media release that "these cases provide an appropriate vehicle to test the legal and regulatory framework that applies to enforcement action taken against borrowers by "low doc" lenders where the conduct of an intermediary toward the borrowers is, or may be, in question."