The Australian Competition and Consumer Commission has instituted proceedings in the Federal Court, Adelaide, against Fox Symes & Associates Pty Ltd, its directors Mr Tim Maher and Ms Deborah Southon, and also a related company, Debt Relief Services Pty Ltd, alleging misleading and deceptive conduct and also unconscionable conduct.
The ACCC alleges that during 2000-2002, Sydney-based Fox Symes extensively advertised its services across Australia as a debt relief administrator, particularly with respect to debt agreements under Part IX of the Bankruptcy Act 1966.
The ACCC alleges breaches of section 52 of the Trade Practices Act 1974, through Fox Symes making false or misleading representations when advertising and counselling clients that:
- their services would release clients from debt and that it was not bankruptcy
- all of their consultants were professional debt management consultants
- client's credit ratings would not be adversely affected
- creditors would be repaid in full, when, in fact, Debt Relief Services Pty Ltd, an undisclosed related company, received part of the repayment sum
- debts would be frozen immediately and
- interest would not accrue.
The ACCC further alleges that the two companies engaged in unconscionable conduct because they were aware that their customers were likely to be financially or socially vulnerable but nonetheless they knowingly engaged in conduct which exploited that vulnerability.
The ACCC is seeking remedies against the respondents that include:
- declarations that they engaged in misleading and deceptive conduct and false representations
- declarations that they engaged in unconscionable conduct
- injunctions, orders for remedial action, refunds, community service, and costs.
A directions hearing is listed for 4 May 2004 in the Federal Court, Adelaide.