Centrelink gives dodgy businesses access to recipients’ accounts

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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?

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Starting out as a week of work experience in 2005 while studying his Bachelor of Business at Swinburne University, Drew has never left his post and has been with the company ever since, working on the websites digital needs. Drew has a passion for all things technology which is only rivalled for his love of all things sport (watching, not playing).
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57 Comments

Total Comments: 57
  1. 0
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    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.

    • 0
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      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.

    • 0
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      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.

    • 0
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      I don’t sign ANYTHING until I have read it thoroughly.

    • 0
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      Eliza, but most elderly vote LNP. Those who do deserve whatever they get.

  2. 0
    0

    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.

    • 0
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      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.

    • 0
      0

      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.

    • 0
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      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

    • 0
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      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.

  3. 0
    0

    Information held in trust by government and it agencies and its contractors is a sacred trust – no ifs,no buts.

    • 0
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      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….

    • 0
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      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.

    • 0
      0

      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.

  4. 0
    0

    I think all Centrelink clients need protection from Centrelink.

  5. 0
    0

    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.

    • 0
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      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.

  6. 0
    0

    This is wrong our government shouldn’t be involved in this.

  7. 0
    0

    Centrelink are not allowed to disclose personal information to third parties without their client’s permission. That it is a breach to do so.

    • 0
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      I entirely agree Jackie – this is totally wrong and Centrelink should not be doing this at all. Too much
      shonky stuff going on.

    • 0
      0

      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

    • 0
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      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.

  8. 0
    0

    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.

    • 0
      0

      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.

    • 0
      0

      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

  9. 0
    0

    If some one in the private sector released this sort of information they would probably be jailed for it.

    • 0
      0

      Not if they had been given a person’s authority to do so.

    • 0
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      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.

    • 0
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      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!

    • 0
      0

      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.

  10. 0
    0

    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!

    • 0
      0

      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.

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