For the past week, Rowena Lagana has struggled with the pain from her back injury because she couldn’t afford to buy painkillers.
She was relying on payments from a debt management firm, which last year the Financial Ombudsman Service found had drawn up an “unconscionable” contract. The firm, Clickthru, was ordered to pay Ms Lagana $12,880 plus interest.
Sophie Gerber, director of financial consultancy firm Sophie Grace, said there was a definite trend in businesses cancelling their licence simply to avoid paying compensation to victims.
“[The issue of avoidance] is most concerning for small Australian financial services licence holders who do not have much to lose by cancelling their licence and moving on to operate under a different structure, or simply exiting the industry,” she said.