Action:
1. No identification on file. Please upload.
2. No identification on file for applicant one. Please upload.
3. No identification on file for applicant two. Please upload.
4. No identification on file for applicant three. Please upload.
5. No identification on file for applicant four. Please upload.
What you must do:
Please upload the documents used to verify the identity of each of your clients.
Why is this important:
Under the Anti Money Laundering and Counter Terrorism Financing Act there must be customer identification procedures in place to know your customers. The AML CTF rules set out the minimum information which must be collected and verified.
Customers’ identity information provided must be verified to ensure identification details on each document are consistent i.e. name, date of birth and signature are the same on all identification documents provided by the customer.
Action: Tax File Numbers are visible. Please remove.
What you must do:
Ensure all Tax File Numbers (TFNs) are removed from supporting documents. Mercury has a TFN redaction function (“Redact”) to remove tax file numbers from documentation. For more information on redact, please refer to the following article Redacting TFNs from a PDF Attachment.
Why is this important:
The Privacy (Tax File Number) Rule 2015 (TFN Rule) issued under section 17 of the Privacy Act regulates the collection, storage, use, disclosure, security and disposal of an individual’s TFN information. Tax File Numbers cannot be held or stored on documents unless you are authorised to hold this information (i.e. an accountant). It is important to note that even if you are permitted to use and store client’s TFN’s (i.e. an accountant) this rule only relates to the storage of TFNs for accounting purposes and does not extend to holding or storing the TFN for credit assistance purposes.
The TFN Rule only applies to the TFN information of individuals and does not apply to TFN information about other legal entities such as corporations, partnerships, superannuation funds and trusts.
The TFN Rule is legally binding. A breach of the TFN Rule is an interference with privacy under the Privacy Act. Individuals who consider that their TFN information has been mishandled may make a complaint to the Office of the Australian Information Commissioner (OAIC).
Action:
1. Please upload income documents.
2. Please upload income documents for applicant one.
3. Please upload income documents for applicant two.
4. Please upload income documents for applicant three
5. Please upload income documents for applicant four.
6. Please upload additional documents which supports the declared income for applicant one.
6. Please upload additional documents which supports the declared income for applicant two.
7. Please upload additional documents which supports the declared income for applicant three.
8. Please upload additional documents which supports the declared income for applicant four.
What you must do:
Please upload all documents which evidences the customer’s stated income which was used to service the loan. For further guidance on the documents which can be used to support a customer’s income, please refer to the following wiki page: https://wiki.connective.com.au/en/articles/1136-responsible-lending-and-compliance-requirements
Why is this important:
Under the NCCP, you must be able to evidence that a customer can service the loan without substantial hardship and making inquiries into the nature of ongoing income levels as well as taken reasonable steps to verify that information is a key requirement of the NCCP.
Action:
1. Please upload evidence of rental income.
2. Please upload additional documents which supports the rental income.
What you must do:
Please upload all documents which evidences the stated rental income used to service the loan.
Why is this important:
Under the NCCP, you must be able to evidence that a customer can service the loan without substantial hardship and making inquiries into the nature of ongoing income levels as well as taken reasonable steps to verify that information is a key requirement of the NCCP.
Action:
1. Please upload transaction account statements.
2. Please upload transaction account statements for applicant one.
3. Please upload transaction account statements for applicant two.
4. Please upload transaction account statements for applicant three.
5. Please upload transaction account statements for applicant four.
6. Please upload three months evidencing salary credits and living expenses for applicant one.
7. Please upload three months evidencing salary credits and living expenses for applicant two.
8. Please upload three months evidencing salary credits and living expenses for applicant three.
9. Please upload three months evidencing salary credits and living expenses for applicant four.
What you must do:
It is a mandatory requirement for Connective Credit Representatives to obtain the latest three months of transaction account statements for all applicants evidencing salary credits and living expenses. If the client is self-employed, three months of statements remains a requirement to verify living expenses. Please upload the client’s transaction account statements.
For members who operate under an ACL other than Connective, it is recommended recent transaction accounts are obtained to ensure you meet your responsible lending obligations to take reasonable steps to verify the client’s financial situation.
Why is this important:
Under NCCP, reasonable steps to verify the customers' financial situation must be undertaken, this includes the customer’s income, liabilities and ongoing monthly commitments (living expenses). Merely relying on the figure declared by the customer for their monthly expenditure is insufficient to evidence reasonable steps have been taken to verify the information provided by the customer.
Connective offers CashDeck as a simple tool to assist you in undertaking your verification of the client’s bank statements to assess living expenses. For more information, please refer to the following articles:
Action: Please document the steps taken to make reasonable enquiries into the customers living expenses.
What you must do:
There are no transaction accounts on file to verify the customer’s declared living expenses. Please document the steps taken to verify the amount declared by the customers.
Why is this important:
Under NCCP, reasonable steps to verify the customers' financial situation must be undertaken, this includes the customer’s income, liabilities and ongoing monthly commitments (living expenses). Merely relying on the figure declared by the customer for their monthly expenditure is insufficient to evidence reasonable steps have been taken to verify the information provided by the customer.
Connective offers CashDeck as a simple tool to assist you in undertaking your verification of the client’s bank statements to assess living expenses. For more information, please refer to the following articles:
Action: The bank statement has a liability which is not disclosed. Either obtain evidence this has been closed or update the borrowing calculator.
What you must do:
A liability has been identified on the customer’s bank statement. This liability may or may not be ongoing and further action and commentary is required.
If the liability is ongoing, please ensure the borrowing capacity calculator is updated and the lender is notified of this. It is important to ensure the customer can service inclusive of this additional commitment.
If the liability is not ongoing, either include confirmation from the customer this will be paid out prior to settlement or obtain details from the financial institution that the debt has already been finalised and closed.
Why is this important:
Under the NCCP it is important to ensure the customer can service without substantial hardship and a correct borrowing calculator inclusive of all debts and liabilities confirms the steps you have taken to ensure the customer can afford the new loan.
Action:
1. The bank statement shows dependent children, please update the borrowing calculator.
2. There is evidence the customer has dependent children. Please update the borrowing calculator.
What you must do:
There is evidence on the customer’s supporting documents of dependent children. This could either be in the customer’s tax return, identity documents (Medicare) or on the bank account statements.
You will be required to obtain additional information from the customer about the age of the dependent and either:
Make appropriate notes if the child is not considered dependent (I.e. 18 years of age with independent income)
If the child/ren is dependent, update the borrowing capacity calculator and adjust (where required) the customer’s stated living expenses to confirm the customers can service the debt
If the child/ren is dependent, update the lender the application was lodged to confirm the customer has dependent children
Why is this important:
Under the NCCP it is important to ensure the customer can service without substantial hardship and a correct borrowing calculator confirms the steps you have taken to ensure the customer can afford the new loan.
Action: Opportunities must be lodged in Mercury before AOL.
What you must do:
A new opportunity must be created in Mercury prior to the client’s loan application being submitted to a lender through AOL. Please acknowledge you understand this requirement.
Why is this important:
Under NCCP, disclosure documentation must be provided within certain timeframes. Creating the opportunity in Mercury and providing the NCCP disclosure documents is important to confirm the timeframes prescribed in the regulations have been adhered to.
Action: There is insufficient information held to present a complete file. Please ensure you meet best practice regulatory guidance for record keeping.
What you must do:
Ensure all records relating to the customer transaction are held in a single repository. Records not only relate to the information you have obtained from the customer but also includes your NCCP disclosure documents, supporting documents, communication and steps taken to verify the customer’s personal and financial information.
File notes should be recorded for every client, lender and third party interaction which demonstrates a timeline of the transaction to meet your Best Interests Duty obligations and general compliance requirements.
Good file notes are invaluable in the event of a customer complaint and to provide evidence of the steps taken throughout the process of providing credit assistance.
Why is this important:
ASIC Regulatory Guide 209 on responsible lending specifically outlines records of the credit assistance process should be kept together. If you do not have a single repository for the file and the steps you have taken, it may be difficult to evidence you have complied with your obligations.
Action: The loan was submitted in AOL by a person other than yourself as the authorised broker.
What you must do:
The application has been submitted in AOL by another person other than the accredited broker. Please note that some lenders monitor who the application has been “submitted” by as this is considered a credit assistance function and should therefore be performed by the authorised broker. Your admin support team can draft the application however the final oversight of the application and pressing of submit to the lender should occur by you as the authorised broker. Please acknowledge you understand this requirement.