BMW Hit With $77-Million Fine For Unserviceable Loans

BMW Australia is currently the focus of international automotive media attention after incurring a $77 million bill from corporate watchdog the Australian Securities & Investment Commission (ASIC).

The findings relate to loans underwritten by BMW Australia Finance Limited to customers who could not afford them.

BMW Australia must now compensate more than 15,000 customers who may have suffered financial hardship between January 2011 and August 2016.

According to a statement from ASIC, Deputy Chairman Peter Kell said: “BMW Finance had a sales-driven culture that failed to comply with the requirements of the credit laws and resulted in poor outcomes for many customers."

Newsagency Reuters reports this is Australia’s largest ever consumer credit radiation program.

BMW must pay $50 million towards the write-off of the loans and smaller sums will be paid for compensation, interest rate reductions on existing loans, and initiatives to ensure customers receive improved understanding of the agreements they sign.

BMW Australia said it is working with ASIC to ensure its practices comply with Australian laws.

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