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A subsidiary of Westpac, the mortgage lender is accused of breaching its credit licence after allegedly engaging in unlicenced conduct between June 2019 and April 2023.
The Australian Securities and Investments Commission (ASIC) alleged RAMS overstepped by:
- Dealing with unlicensed referrers.
- Failing to have in place adequate arrangements to ensure that customers were not disadvantaged by any conflicts of interest.
- Failing to comply with the credit legislation.
- Failing to supervise representatives (that is, the RAMS representatives) to ensure compliance with credit laws (which included failures to create and enforce adequate policies and procedures, and failures to investigate misconduct).
- Failing to do all things necessary to ensure that the credit activities authorised by the licence are engaged in efficiently, honestly and fairly.
According to ASIC deputy chair Sarah Court, the ongoing issue was “allowed” by RAMS over a number of years.
“This is a systemic organisational governance failure by RAMS who did not adequately supervise its franchise network.”
“RAMS allowed years of unlawful conduct to occur across its franchises, creating the opportunity for loans to be provided to customers who otherwise may not have qualified for those loans, and thereby increasing commissions earned by RAMS franchisees,” said Court.
“RAMS franchise staff were found to have submitted false pay slips from non-existent employers and altered customers’ liabilities and expenses to enable them to meet serviceability requirements to get the loan application over the line, while in another example a RAMS franchise employee was found to be involved in manufacturing a fake contract of sale for a home.”
The date for the hearing is yet to be set but ASIC said it is chasing “declarations and pecuniary penalties.”
Westpac responds
The major acknowledged the proceedings and revealed RAMS had reached an agreement with ASIC to resolve the investigation.
RAMS is cooperating with ASIC to resolve the issue.
"Westpac expects existing provisions should be sufficient to meet the financial outcome of the proceedings, subject to court approval," said Westpac in a statement.
"Following a review of the RAMS business, RFG [RAMS Financial Group] completed a remediation program. RFG closed the RAMS business to new home loan applications from 6 August 2024. RAMS customers continue to access services through the RAMS app, website and call centre."
Double trouble
This is the second time RAMS has made the news in 2025. The first was in April after it was suspected there was fraud happening at RAMS Home Loans franchises.
Samantha Aitken, Westpac’s head of audit, risk, and compliance, said executives ignored her concerns about alleged fraud and criminal activity at some of the franchises of RAMS Home Loans between June 2022 and the start of 2023.
The alleged activity included staged wages, document falsification, self-referral of clients, and using unaccredited or ‘grey’ listed referrers. Westpac closed local RAMS centres last August and no longer accepts new applications for home financing.
Westpac denied all allegations of fraud at the RAMS franchises.
[Related: Westpac denies claims leaders ignored fraud concerns at RAMS franchises]
