RAMS Faces Legal Action Over Years of Home Loan Misconduct

The regulator says unlicensed staff, poor oversight, and lack of controls at RAMS—owned by Westpac—led to widespread legal breaches.

A man walk past ATMs at a regional branch of Westpac bank in Albany, Western Australia, on Nov. 22, 2023. Susan Mortimer/The Epoch Times

The Australian Securities and Investments Commission (ASIC) has launched civil penalty proceedings in the Federal Court against RAMS Financial Group (RAMS), citing extensive misconduct in its home loan operations between June 2019 and April 2023.

According to ASIC, RAMS—an Australian Credit Licence (ACL) holder and a wholly owned subsidiary of Westpac—allowed unlicensed individuals to facilitate home loans, failed to properly oversee its authorised representatives, and lacked sufficient internal controls.

The regulator claims these lapses led to ongoing breaches of the National Consumer Credit Protection Act 2009 across its franchise network.

“This is a systemic organisational governance failure by RAMS who did not adequately supervise its franchise network,” said ASIC Deputy Chair Sarah Court.

“RAMS allowed years of unlawful conduct to occur across its franchises, creating the opportunity for loans to be provided to customers who otherwise may not have qualified for those loans, and thereby increasing commissions earned by RAMS franchisees.”

RAMS Admits Breaches

Westpac confirmed that RAMS Financial Group Pty Ltd (RFG) has admitted to the breaches and agreed to resolve the matter through civil proceedings.

“The proceedings relate to RFG’s oversight of the conduct of RAMS franchisees and their employees between June 3, 2019, to April 30, 2023,” a Westpac spokesperson told The Epoch Times.

RAMS has completed a remediation program for affected customers and is working with ASIC to conclude the court process swiftly.

Westpac noted that financial provisions already in place are expected to cover the outcome of the case, pending court approval.

As part of its exit from the business, RAMS stopped accepting new home loan applications on Aug. 6, 2024. Existing customers can still access services via the RAMS app, website, or call centre.

Franchise Model Under Scrutiny

RAMS operated as a standalone brand under Westpac, offering Westpac-funded loans via a network of independent franchisees, primarily targeting first-home buyers and self-employed borrowers.

Despite holding an ACL, RAMS only provided credit assistance and did not directly offer loans.

In August 2024, Westpac announced the closure of all RAMS franchise offices and the transfer of $31.8 billion in loans to Westpac’s books.

The case comes amid increased regulatory pressure on the financial sector.

On June 3, ASIC also launched fresh proceedings against insurance comparison platform Choosi, accusing it of misleading consumers and favouring insurer Hannover, which paid the company $61 million in commissions between 2019 and 2024.