The Full Federal Court today unanimously dismissed an appeal by Cigno Australia Pty Ltd and BSF Solutions Pty Ltd and their respective directors.
The Full Court has upheld the Federal Court's judgment of 24 May 2024 that found Cigno Australia and BSF Solutions engaged in credit activity without an Australian Credit Licence and charged consumers prohibited fees. The Court also found that Cigno Australia director Mark Swanepoel and BSF Solutions director Brenton Harrison were involved in those contraventions.
Justices Anderson, Cheeseman and Rofe held that 'there was no error by the primary judge in concluding that Cigno and BSF established and implemented, for their joint benefit, a shared business model, namely the No Upfront Charge Loan Model'.
ASIC Chair Joe Longo said, 'We are pleased the Full Court has confirmed the decision that Cigno Australia and BSF Solutions and its directors engaged in Credit Act breaches through its 'No Upfront Charge Loan Model'.
'ASIC considers that the model was designed to avoid consumer protection laws and to allow the charging of significant fees to consumers, many of whom were vulnerable and in financial distress'.
'Cigno Australia and BSF Solutions provided $34 million in loans to more than 100,000 consumers between July 2022 and December 2022 through its 'No Upfront Charge Loan Model'. Through this model, consumers were charged substantial fees of over $70 million.'
'Consumer protection and taking action against and stopping harmful lending is an enduring ASIC priority.'
On a date to be set, the matter will come back before Justice Jackman for a hearing on the appropriate penalty.
The Court ordered that the Appellants pay ASIC's costs for the appeal.
