Govt calls to stop property spruikers
June 23, 2005 - 2:54PM
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A parliamentary committee has recommended a national approach to drive property spruikers out of business.
The committee also recommended the courts be given the power to be able to compel spruikers to give refunds to their victims whether or not the victims are party to any legal action.
Chairman of the parliamentary joint committee on corporations and financial services Grant Chapman (LP, SA) said it was no longer appropriate for the government to leave such matters entirely in the hands of the states.
"The evidence gathered and the findings of this inquiry show clearly that this is no longer satisfactory. The aspect relating to property spruikers must be brought under federal jurisdiction," he said.
Senator Chapman said the risk of property investment should be the normal risks associated with the free play of the market.
"The risks should not be ones of being fleeced by a sharp operator with glittering promises and an eye for a fast buck," he said.
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AdvertisementA succession of property spruikers operated by conducting seminars promoting investment in property and promising substantial returns to investors.
Radio, internet and newspaper ads placed by one of the better known promoters Henry Kaye outlined the "$1 million Challenge" available at free seminars where Kaye would choose five volunteers and turn them into a property millionaire within six months without using their own money or risking going into debt.
Other claims included that 1,000 people would become property millionaires inside a year after signing up for his seminars.
Court orders were made against Kaye last year stopping him repeating his get-rich-quick claims.
Undercover officers of the Australian Securities and Investments Commission who attended eight property seminars last year estimated they netted their organisers $60 million in fees from punters who paid between $5,000 and $20,000 a head.
Senator Chapman said the committee believed the treasurer should look into providing the Australian Competition and Consumer Commission with cease and desist powers to stop spruikers before they start.
He said they also recommended that there be mandatory disclosure of property valuations by lending institutions and targeted advertising by ASIC to assist consumers identify property spruikers.
"The committee is aware that no regulatory regime, without being tyrannical in nature can completely shut down the use of deceit and manipulation in commercial practice," he said.
"While the committee is confident that the proposed regulatory regime will make life much more difficult for spruikers, it's inevitable that some unscrupulous operators will surface from time to time.
"Even with the new regulatory regime in place, consumers will need to remain alert to look to their own interests and to approach anything which looks too good to be true with a healthy scepticism."
June 23, 2005 - 2:54PM
Page Tools
Email to a friend Printer format
A parliamentary committee has recommended a national approach to drive property spruikers out of business.
The committee also recommended the courts be given the power to be able to compel spruikers to give refunds to their victims whether or not the victims are party to any legal action.
Chairman of the parliamentary joint committee on corporations and financial services Grant Chapman (LP, SA) said it was no longer appropriate for the government to leave such matters entirely in the hands of the states.
"The evidence gathered and the findings of this inquiry show clearly that this is no longer satisfactory. The aspect relating to property spruikers must be brought under federal jurisdiction," he said.
Senator Chapman said the risk of property investment should be the normal risks associated with the free play of the market.
"The risks should not be ones of being fleeced by a sharp operator with glittering promises and an eye for a fast buck," he said.
Advertisement
AdvertisementA succession of property spruikers operated by conducting seminars promoting investment in property and promising substantial returns to investors.
Radio, internet and newspaper ads placed by one of the better known promoters Henry Kaye outlined the "$1 million Challenge" available at free seminars where Kaye would choose five volunteers and turn them into a property millionaire within six months without using their own money or risking going into debt.
Other claims included that 1,000 people would become property millionaires inside a year after signing up for his seminars.
Court orders were made against Kaye last year stopping him repeating his get-rich-quick claims.
Undercover officers of the Australian Securities and Investments Commission who attended eight property seminars last year estimated they netted their organisers $60 million in fees from punters who paid between $5,000 and $20,000 a head.
Senator Chapman said the committee believed the treasurer should look into providing the Australian Competition and Consumer Commission with cease and desist powers to stop spruikers before they start.
He said they also recommended that there be mandatory disclosure of property valuations by lending institutions and targeted advertising by ASIC to assist consumers identify property spruikers.
"The committee is aware that no regulatory regime, without being tyrannical in nature can completely shut down the use of deceit and manipulation in commercial practice," he said.
"While the committee is confident that the proposed regulatory regime will make life much more difficult for spruikers, it's inevitable that some unscrupulous operators will surface from time to time.
"Even with the new regulatory regime in place, consumers will need to remain alert to look to their own interests and to approach anything which looks too good to be true with a healthy scepticism."
