Consumer advocates have welcomed the decision by the Federal Court to fine Cigno Australia and its director Mark Swanepoel, and BSF Solutions and its director Brenton Harrison a combined penalty of $7 million for engaging in credit activity without a licence and charging prohibited fees.
“Congratulations to the Australian Securities and Investment Commission (ASIC) for taking bold regulatory action against not only Cigno, one of the worst predatory lenders we have seen, and to its directors personally,” Consumer Action Law Centre CEO, Stephanie Tonkin said.
“Cigno and BSF charged an extortionate $90 million in fees for their no up front charge loan product - specifically designed to avoid consumer protections, and knowingly used by people in financial distress. Financial counsellors across the country saw this financial harm and aggressive debt collection devastating consumers and families.
“We welcome penalties imposed against the companies and the two directors personally - and the court reasoned that the $7 million fine is a substantial deterent for this abhorent behaviour. The question is, after this years-long saga of harms incurred by thousands of Australians …. Will this be the final nail in the coffin for Cigno?” she said.
Quote attributable to Aaron Davis, CEO, Indigenous Consumer Assistance Network (ICAN):
“This $7 million penalty is a long‑overdue acknowledgment of the significant harm Cigno has caused people across the country and, from ICAN’s experience, throughout North Queensland. We have seen firsthand the financial and emotional damage Cigno inflicted on people already under pressure. This judgment sends an important message that exploiting vulnerable consumers will not be tolerated.”
Quote attributable to Alexandra Kelly, Director of Casework at Financial Rights Legal Centre:
“This is a significant penalty – but unfortunately many of the consumers impacted by Cigno’s conduct will not get financial redress. Hopefully this will be a strong deterrent to individuals seeking to develop shonky business models between regulatory cracks – there will be consequences if you rip people off.”
Quote attributable to Domenique Meyrick, CEO, Financial Counselling Australia:
“This case exposes what happens when financial products are deliberately engineered to dodge the law rather than serve consumers. For years, financial counsellors saw people in deep distress trapped by a product designed to avoid consumer protections and maximise fees.
“The Court’s decision to hold both the companies and their directors personally liable is an important and overdue signal. When complex corporate structures and ‘creative’ workarounds are used to sidestep the rules, personal accountability is not only appropriate, it’s essential to deter this kind of predatory conduct and prevent further harm.”
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