30th Jan 2018

Centrelink gives dodgy businesses access to recipients’ accounts

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Centrelink gives dodgy businesses access to recipients’ accounts
Drew Patchell

It has been revealed that Centrelink gave appliance retailers accused of exploitation access to the Centrepay system to withdraw payments from Centrelink recipients.

This allowed these approved businesses the ability to withdraw funds directly from Centrelink payments prior to being received by the recipient – even before necessities such as rent, power and food expenses could be covered.

In 2015, the Australian Securities and Investments Commission (ASIC) warned Centrelink that the lease-to-buy and appliance rental sector was targeting Centrelink recipients, often charging more than five times the retail price of leased goods.

“We had examples of consumers who were on disability pensions or Newstart allowance where they were literally running out of money at the end of the month because of the impact of the repayments that were being made for those consumer lease products,” ASIC senior executive Michael Saadat told the ABC.



According to research by Guardian Australia, at least four appliance rental companies that had been punished by the regulator, or were placed on binding agreements to rectify potential legal breaches, were granted approval to use Centrepay.

The Federal Government is looking to introduce new restrictions on small credit companies including rent-to-buy operators to keep customers from spending more than 10 per cent of their total income on contracts.

What do you think? Does more need to be done to protect the most vulnerable Centrelink recipients? Should retailers with a history of exploitation and targeting have their Centrepay access revoked?

Related articles:
Centrelink overpays $2.84 billion
Centrelink offers free money advice
Centrelink snitches raise $40m





COMMENTS

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Joy Anne
30th Jan 2018
10:32am
This is so wrong for welfare recipients . These Rent to Buy should be illegal, they make a fortune from people who can least afford it. In 2005 I got caught by one of these, I was told the repayments would be for 1 year for a fridge I needed desperately and once my term came up they advised that I had to pay for another 2 years. That is so wrong. I paid 4 times the amount of a fridge the same. Never again. They should be banned as their paperwork is so confusing and unreadable as they don't let you read until you have signed.
HDRider
30th Jan 2018
10:39am
I understand what you are saying Joy but, if they don't let you read the conditions or play hard to get them that should ring alarm bells.
What they are doing is unscrupulous and must be stopped. I personally would rather go without a fridge.
A class action is needed and Centrelink should be heels accountable for this illegal breach.
Eliza
30th Jan 2018
7:22pm
HOW DARE they breach the privacy and confidentiality of individual citizens ... or has this government been going to fashist school ...
Should we not be protecting the vulnerable ???
There but for the grace of ...

We really need to think VERY CARFULLY about where we are going.
IS THIS THE THIN EDGE OF THE WEDGE ???
complacency is our enemy ...
WE VOTE ... GREY POWER IS POWERFULL
USE IT.
OUR VOICE ... OUR VOTE.
Knows-a-lot
1st Feb 2018
7:02am
I don't sign ANYTHING until I have read it thoroughly.
Knows-a-lot
1st Feb 2018
7:04am
Eliza, but most elderly vote LNP. Those who do deserve whatever they get.
HDRider
30th Jan 2018
10:35am
The man in charge of Centrelink, Jongen, the one that got on TV and threatened recipients etc should now be held to account and charged.
Just one more piece of evidence of what a toothless tiger ASIC really us and how useless Centrelink is. Really, they just do what they like and have no respect for anyone. An agreement with these companies between a customer and them is just that, Centrelink have surely broken the law on this one.
Cowboy Jim
30th Jan 2018
11:31am
Henk Jongen is just a public servant doing the Govt's bidding. No point charging him with anything, you would have to charge the
Social Services Department. Don't think you would get very far either.
Just do not deal with these dodgy companies - get a cheap fridge
from the paper advertisement, plenty of 2nd hand ones available.
I got one myself.
TREBOR
30th Jan 2018
12:53pm
That's when you have senior management held to ransom over their contract renewal - they are in the pocket of the government of the day - something that neither 'side' of The Tag Team wants to change.

BOTH 'right' and 'left' want control over the public service, much more than is warranted by a proper division of powers. Thank Adolph Howard for that.
missmarple
30th Jan 2018
1:45pm
Don't need to go to these places to get ripped off, just get a loan from centrelink at least you will know exactly how much you will pay back and for how long
ray from Bondi
30th Jan 2018
9:05pm
while driving today I heard at least 4 different politicians saying there is no corruption, nothing to see here, and absolutely no need of any other body looking over their shoulders to ensure all is correct. I suppose this is not a corrupt action but it needs looking into.
TREBOR
30th Jan 2018
10:55am
Information held in trust by government and it agencies and its contractors is a sacred trust - no ifs,no buts.
TREBOR
30th Jan 2018
11:01am
ADDS:- I would trust that the Dam busters size leaks from D^D over restricted (and all other) records have been stopped now..... twenty odd years after I complained.....

ONLY those with a genuine interest may apply for military records. That's my principle....
JAID
1st Feb 2018
3:41pm
I agree with the first statement Trebor, less with the modification.

If information is personal then there should never be any 'if' or 'buts' It may be reasonably useful for administrative purposes that census be taken but even there no possible link with individuals should be able to be divined.

Military personnel are people too. Their personal information should belong to them.

Census has, at everybody's cost gone beyond collection of information for the benefit of the administration of government and become an aid to marketeers.

Personal information is, for example, valuable in the science of health. I am not sure I agree that even that should be collectable by force but if it is there should be no traceable connection between the data and the individual.

Peoples tastes, fitness, age, occupation, wealth, happiness and the rest can reasonably have an impact upon governance but only the general body of data is reasonably needed to achieve that result.

I would go further and make it illegal to require much of this information. The likes of Telstra will always ask for your birthday to confirm that you are who you say you are. How that could prove anything when a birthdate is so easily researched is beyond me.

Even shops or manufacturers will require this and other information so that they can meet their idea of what constitutes a pertinent and profitable database. If you buy a product with a 1 year warranty for example, it seems to me that if the manufacturer wishes to make collection of a wealth of personal data a prerequisite to access to warranty then that should be put up in lights over the item where you can see it before you buy. If it happens to be in any small print I have never seen it.

Most do not do this on the scale described of course. It is changing however. I attribute it to the American stranglehold on the internet where a culture of extreme marketing and acquisitiveness paints the personal information collections of Google, Facebook, Amazon, Ebay, Microsoft and others as normal rather than aggressively nosey with the aim of financial gain.

The pyramid sellers along with the Xerox's and Tupperware's have morphed into something far more intelligent in the abuse of contact and the captivation of market.
VeryCaringBigBear
3rd Feb 2018
8:36am
You simply have 2 birth dates and only use the right one when it can be checked. If some one rings and asks for your date of birth give them the wrong one. If they say it's wrong then they may be legit. If they accept it then you are dealing with some one who is not who they say they are.

You need to protect your identity from these fraudsters.
BundyGil
30th Jan 2018
11:32am
I think all Centrelink clients need protection from Centrelink.
ray from Bondi
30th Jan 2018
9:05pm
here here
Priscilla
30th Jan 2018
11:56am
Unbelievable! It appears there are no laws protecting vunerable people from unscrupulous businesses. There are only laws protecting businesses. Everyday the government proves how much they are prepared to protect businesses no matter their crimes. The McGowan government looks after the wealthy city areas and robs the outer areas. Shame on them.
ray from Bondi
30th Jan 2018
9:07pm
the government says we all love a right-wing government that ensures business is very very profitable for the few, the rest have to be squeezed to ensure this happens.
Tib
30th Jan 2018
12:14pm
This is wrong our government shouldn't be involved in this.
jackie
30th Jan 2018
12:14pm
Centrelink are not allowed to disclose personal information to third parties without their client's permission. That it is a breach to do so.
Troubadour
30th Jan 2018
12:33pm
I entirely agree Jackie - this is totally wrong and Centrelink should not be doing this at all. Too much
shonky stuff going on.
ray from Bondi
30th Jan 2018
9:08pm
no wonder politicians say there is no need for an overseeing body they are all honest and I heard a polly on the radio saying just that so it must be true
VeryCaringBigBear
31st Jan 2018
5:33pm
Bring back the good old days when there used to be parties where people from many organisations got to know one another so information could be exchanged for the benefit of all. It would not surprise me it doesn't still happen.
KSS
30th Jan 2018
1:00pm
My question is how do these companies even know the customer is on Centrelink payments in the first place? I suspect the customer tells them and in the T&Cs agrees for the money to be taken directly from their welfare payments.

"I didn't read or understand what I was agreeing to when I signed the form" is actually no excuse. I agree with HDRider, anyone being pushed to sign anything without being given time to read and understand the document, should get up and walk away, whether the agreement is for a gym membership, bank account, mortgage, or in this case electrical goods and computers etc or anything else. There is always an alternative course of action including getting a hardship payment from Centrelink itself (which is then deducted from the welfare payment before the recipient gets it) as others have pointed out.
Polly Esther
30th Jan 2018
3:00pm
Yes KSS your first paragraph is spot on, and your second paragraph should be heeded by the 'desperate' who apparently think they have cracked onto a good thing to obtain goods more 'easily?'
They discover later on of course that this is not the case, and then Centrelink cop the entire blame. Centrelink are between a rock and a hard place in this situation, as the saying goes.
Blossom
8th Feb 2018
8:54pm
I asked an Electricity Provider for a blank copy of a contract so I could read the Terms & Conditions which were in tiny print on coloured paper. He flatly refused so I asked him to leave and close the front gate as he left as he had left it open.

Later I found out the company did not have a good reputation so I wouldn't switch to them even now
arbee
30th Jan 2018
2:16pm
If some one in the private sector released this sort of information they would probably be jailed for it.
VeryCaringBigBear
31st Jan 2018
2:30pm
Not if they had been given a person's authority to do so.
Knows-a-lot
1st Feb 2018
7:10am
BigBear - What if that authority was conned out of a confused elderly person? Don't believe for one second that some in the private sector would not do this.
OnlyGenuineRainey
1st Feb 2018
7:43am
Knows-a-lot, in BigBear's self-centred world there are no vulnerable people. Everyone is either highly competent and privileged, or stupid and irresponsible. The blame the victim mentality is alive and well in many parts of Australia, sadly. As is the mentality that says if you object to a wrong, it must be hurting you personally. Apparently people in BigBear's world people don't think of anyone but themselves, and empathy is all but dead. Sad state of affairs!
VeryCaringBigBear
1st Feb 2018
3:24pm
No one needs to be vulnerable but a thing called pride gets in the way and makes many vulnerable. This is what I called being dumb and stupid.
Big Al
30th Jan 2018
3:34pm
I cant imagine why anyone would want to go down this path in the first place, to purchase an essential item such as a fridge or washing machine. Through the neighbourhood house system, people on a government benefit have access to the 'NILS" system - No Interest Loans Scheme - underwritten in part by the National Australia Bank - and as good as it sounds. People in need to can get access, and help - much better to avoid the sharks. I am surprised some of the responders to this article who have been caught, didn't know about such a scheme. Ignorance is costly!
Cowboy Jim
30th Jan 2018
3:47pm
Thanks for bringing the folks up to date, Big Al. Sometimes all people need is sound advice and a finger pointing them in the right direction.
Raphael
30th Jan 2018
4:31pm
Why are these people entering into such agreements in the first place
You cannot legislate against stupidity
Old Man
30th Jan 2018
4:36pm
This is wrong on so many levels. Firstly, Centrelink should never be allowed to have an order on payments ratified. If anyone wants to buy anything, the payments should be made from the payments after they are received. If any retailer wants to deal with Centrelink recipients, let them take their chances on payments directly from the recipient.

It has been a long time since I was involved in debt collecting but the courts could award the right to garnishee wages but the debtor was allowed to retain the basic wage less a set amount. If this system was applied to Centrelink recipients, there would never be any creditor allowed to touch any part of a Centrelink payment.
Anne Ozzie
30th Jan 2018
9:03pm
Looks to me that Centrelink is allowing these fraudulent companies to garnishee welfare recipient's benefits. As I understand it, only the courts have this power and only after the person has appeared in front of the court.
VeryCaringBigBear
31st Jan 2018
2:28pm
No these companies will have been authorised by the person getting such a loan for them to have authority to access their Centrelink payments. People need to read and understand what they are signing.
Knows-a-lot
1st Feb 2018
7:13am
BigBear, some companies clearly do not give people the opportunity to read thoroughly before signing. They are pressured into signing prematurely.
VeryCaringBigBear
1st Feb 2018
3:22pm
If they do pressure people into signing then that is under duress and the document is then not a legal document.
Roller53
30th Jan 2018
11:32pm
I think it is unconsionable for Centrelink to enter any type of agreement with any commercial organisation without approval from the account holder. Since when is Centrelink a debt collector? What is the governments fee from these shonky operators.
Raphael
31st Jan 2018
3:56am
They centerlink beneficiaries are spending taxpayer money
What gives them the right to waste in on buying things that they cannot afford to pay
And then have the nerve to go for even greater government handouts ?
These people never learn how to manage money
That’s why they have ended up on welfare mostly
OnlyGenuineRainey
31st Jan 2018
7:50am
That's very nasty, and totally invalid Raphael. Yes, some pensioners are irresponsible with money. And those who were ripped off by this scheme were probably careless. But that doesn't make it okay for people in more powerful positions to defraud or even overcharge, and it doesn't make it okay for the government to allow a system to continue that permits anyone to rip off. And as for implying everyone on a pension is irresponsible or ''wasted taxpayer money'' - that's just nasty and totally untrue. You have no idea what put some people in their current circumstances, and it's horrid to make such derogatory statements.

Yes, pensions are funded by taxpayers - taxpayers who enjoy massive benefit from a system that supports the privileged far more generously than anyone who ever needs welfare. A system that exploits the less advantaged to line the pockets of the more fortunate, who then whinge about having to pay a little towards maintaining the health of the system that afforded them their privileged position in the first place.

Most well off got far more than their share from the common pool, and far more than anyone now on a pension ever enjoyed. So stop the whining and say ''thankyou'' to those whose hard slog enabled you to enjoy a comfortable retirement without needing a pension.
VeryCaringBigBear
31st Jan 2018
8:03am
Rainey it is no different than what other organisations can do.
OnlyGenuineRainey
31st Jan 2018
10:00am
Oh so that's okay then? X can do it so Y should be allowed, no matter how harmful? That's weird logic! God help us if politicians think that way. Maybe they do and that's what's wrong with Australia.
VeryCaringBigBear
31st Jan 2018
11:21am
Rainey these organisations are not charities so they are entitled to be paid for their services. If one sign an agreement then they have whatever authority that agreement allows them to do.

They only thing wrong with Australia is that people are too lazy or can't care less and sign documents without reading and understanding them. If you are silly enough to so soo then you only have yourself to blame. There are always people available to help those who have trouble with documents. Our local library offers such services.
Knows-a-lot
1st Feb 2018
7:16am
Bravo, Rainey! Right on!
OnlyGenuineRainey
1st Feb 2018
7:37am
What's wrong with Australia, BigBear, is there are too many arrogant and selfish people in it who only think of themselves and assume that if something is wrong, the victim is to blame.
VeryCaringBigBear
1st Feb 2018
3:19pm
Which is usually the case at least 9 times out 0f 10.
VeryCaringBigBear
31st Jan 2018
8:00am
How is this any different that what mobile phones plans do? You and up being charged many times the value of your phone over it's retail value. If you don't pay they can also add as your welfare.

If people would just read and learn the rules such companies would never get off the ground. People are their own worst enemies in these cases.

Mobile phones plans with phone included are nothing but scams to me. Likewise these loans are too. Buy yourself an unlocked phone and go prepaid.

If you need a fridge get a loan from "Centrelink. If you have maxed that out you need to swallow your pride and go to a charity not a loan shark. Remember anyone eager to help you is helping themselves more.
Tarabelle
31st Jan 2018
8:11am
There are many comments here about centrelink recipients not reading the fine print etc, which is ignoring the main point of this article - Centrelink giving others individuals private information. That is the crime that needs to be concentrated on.
VeryCaringBigBear
31st Jan 2018
11:11am
It is not a crime if people have given them authority to get such information. Part of obtaining these "loans" would be agreeing to this. It can also be done verbally over the phone now too.
Nerk
31st Jan 2018
9:01pm
Boycott these businesses, it is obvious that you as a customer are nothing, they want their money even if it means taking food off your table, this where they get you.........it used to be you don't pay a bill, there's not much they could do and in the end you loose your credit rating and declared bankrupt or what ever, now they can take it out no matter where you, complain to centreline and demand that no one touches your money without a court order.
Raphael
31st Jan 2018
11:47pm
Anyone putting a gun to their heads and forcing them to buy
Also imagine the uproar amongs the SJW’s if a business refused to sell to a welfare recipient
Knows-a-lot
1st Feb 2018
7:01am
I blame the LNP - Lieberal-Hillbilly COALition - and their support base for this. That political party of verminous nincompoops supports, and is supported by, greedy business scumbags - the sort of evil bastards who target the poor. Also, the LNP have slashed staff by the thousands in Centrelink; those who are left cannot cope, and are overwhelmed by the sheer number of clients and by the constant barrage of changes.
VeryCaringBigBear
1st Feb 2018
3:20pm
I can't remember ever going into a Centrelink office or even ringing them so it is a case they simply don't need all the staff they once had.
Careworn
5th Feb 2018
6:51am
I feel so sorry for all those good and vulnerable people out there. They are easy prey for the vultures.


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