ACCC takes action against We Buy Houses and Rick Otton regarding property strategies

ASIC media release today:

Following a coordinated investigation with the New South Wales Fair Trading (NSW Fair Trading), the Australian Competition and Consumer Commission has instituted proceedings in the Federal Court against We Buy Houses Pty Ltd and Rick Otton for alleged contraventions of the Australian Consumer Law.

The alleged conduct includes several representations made to consumers that, by attending seminars and boot camps, consumers will be taught strategies to enable them to, for example:

o buy a house for $1
o buy a house using little or none of their own money
o build property portfolios without their own money invested and without new bank loans.

The ACCC alleges that the strategies do not enable consumers to buy a house for $1 but rather involve consumers acting as middlemen to facilitate property transactions between third party sellers and third party buyers. For example, in the context of the ?rent to buy? strategy, the ACCC alleges that this strategy only allows a consumer to secure an option for $1 to purchase a house at a later date, subject to payment of the full purchase price in order to exercise the option.

?The ACCC is concerned that the strategies promoted by We Buy Houses and Mr Otton target vulnerable consumers who don?t qualify for bank loans or who are having difficulties meeting their mortgage repayments,? ACCC Chairman Rod Sims said.


See http://www.accc.gov.au/media-releas...-and-rick-otton-regarding-property-strategies
 
stick your head up and someone wants to lop it off

Yes .. But .. Strictly speaking what they say is true .

Btw , rick has been an active member in the past and many long term members have met him and know him .

Personally I think he is a " good guy and well meaning " . I don't think he is deliberately out to rip people off . He has done VERY WELL out of proprty investing and probably has no financial need to do the courses he has done .

I have a lot more respect for him than he who shall not be named ...

Cliff
 
I take his point tho about 'how far does this go'? E.g. Is 50 shades of grey misleading conduct because you don't get 50 shades of grey
 
I agree with cliff, I've met Rick and he tries to do what he does to mutual benefit with his clients. He makes a good point that buying houses for $1 is only the tip of the iceberg and doesn't hide that there's a lot more behind that simple statement.

Part of the problem is that vendor finance is very open to abuse and there are a lot of people doing it badly.

I recall seeing Today Tonight run a story on how Rick is doing great work with his system, helping people buy houses which they wouldn't normally be able to get finance for. A fortnight later A Current Affair ran a story on another vendor financier fleecing people out of all their money. They were both using exactly the same principals.

I've met a lot of vendor financiers in my business. Some do it well, others financially destroy people who were already vulnerable. Either way it's always going to be under the microscope with the regulators.
 
it reads the ACCC is investigating, not prosecuting yet - if at all.

let's all remember that, shall we?

Sorry Aaron - read the OP's statement again. The ACCC have concluded their investigation and are prosecuting.

I don't know Rick from a bar of soap and have no idea whether he is guilty or not - happy to let the court decide that. However, I am happy to see the ACCC getting active in this space. I often wondered how this industry could promote itself as it did within the confines of the Australian Consumer Law. It was about time the ACCC said "enough" to somebody at least.

Hopefully the rest of them will pull their heads in as a result and perhaps read the law for themselves and try to stay within it - just like everyone else has to do...
 
Back
Top