Brokers! Are you referring clients to unlicensed Credit Repair Agencies?
Credit repair is a recent phenomenon emerging in Australia, with many unlicensed credit repair agencies popping up offering all sorts of commissions to Brokers who refer clients with bad credit histories. However, unless your credit repairer is a *licensed legal practitioner you will not be covered under Professional Indemnity (PI) Insurance.
In this special interview, Small Business Association of Australia member Graham Doessel of MyCRA Lawyers speaks with Darren Loades of Insurance AdviserNet and appointed Insurance Broker for Finance Brokers Association of Australia to explain why Mortgage Brokers could find themselves without PI Insurance cover if they refer their clients to a credit repairer who is not a lawyer/law firm.
In this interview Darren explains why:
- You must declare your referral income to your PI Insurer; and
- You must have a formal written agreement with law firm; and
- You must refer your clients to a credit repair lawyer and not an unlicensed credit repair agency.
Darren points out a Broker referring their client to an unlicensed credit repair agency, while knowing (or should have known) they (the credit repair agency) are not a law firm and therefore not legally entitled to offer credit repair services (legal work), are unlikely to be covered by their PI insurance in the event of civil litigation action against the Broker by the referred client.
This is something that, should a client referred to an unlicensed credit repair agency get ‘miffed’ at you, could potentially destroy your business and so much more.
This Is Serious!
If this is a serious concern to you, please think about only referring your clients to someone you can trust. MyCRA Lawyers is the only Specialist Credit Repair Law Firm in Australia focused solely on Credit Repair with an independently and externally audited successful removal resolution rate of better than 9 out of 10 (91.6%).
*We believe Credit repair work is legal work and therefore reserved for lawyers. See https://lph.la/What_is_legal_work – As such: FIRST if a credit repair agency takes payment, even if they then engage a lawyer for you, as it is the credit repairer that took your money, it is the credit repairer who is providing you with the legal service and fines of up to $54,000 or two years are jail just two of the available remedies. PLUS The person working on your credit repair matter is doing legal work and needs to be directly employed by a law firm, under the direct supervision of a lawyer holding a current practising certificate, or be a lawyer with a current practising certificate.