Brenton James Harrison: Ex-rugby star sued for devastating loans

A high fee, short-term loans scheme that allegedly charged one client fees that were almost 10 times as much as the amount they borrowed was described as “devastating” by a consumer advocate.

The Australian Securities and Investments Commission (ASIC) is suing Cigno Australia Pty Ltd and its director Mark Swanepoel, and BSF Solutions Pty Ltd and its director, Brenton James Harrison, claiming that credit was provided without a licence.

Mr Swanepoel previously played for the ACT Brumbies and Western Force in the Super Rugby competition, before reinventing himself in the financial services space.

“The Cigno Australia and BSF ‘No Upfront Charge Loan Model’ provided short-term credit to more than 100,000 consumers between July 2022 and December 2022 and continued to charge substantial fees to those consumers without either entity holding an Australian credit licence,” ASIC alleges.

ASIC alleges that BSF provided over $34 million in loans while Cigno Australia and BSF charged over $70 million in fees, without either entity holding an Australian credit licence.

Consumer Action Law Centre CEO Stephanie Tonkin told news.com.au that the companies “evolve, adapt and reinvent themselves” and benefit from those “in trouble”.

ASIC deputy chair Sarah Court said: “ASIC believes that this credit model has been designed to avoid consumer protection laws so as to enable these companies to charge significant fees to consumers, many of whom are vulnerable and in financial distress.”

In court documents filed by ASIC lawyers, it’s alleged that one client was charged fees of $1468.72 on a $150 loan, representing 979 per cent of the loan value.

The fees charged included account keeping fees, a fee for defaulting on the loan and a fee for changing the payment schedule.

An initial account keeping fee of $161.22 was charged on the 38 day loan, while the maximum fee permitted under the Credit Act for the same period is $42.

On average the client’s included in the court documents faced fees that were between 200-300 per cent of the original amounts they borrowed.

The latest court action follows a previous lawsuit brought by ASIC against similarly-named companies with the same directors.

In July this year, Cigno Pty Ltd and BHF Solutions Pty Ltd were found by the Federal Court to have engaged in unlicensed credit activity.

In the latest case, ASIC are also seeking “injunctions restraining Mr Harrison and Mr Swanepoel from carrying on or being involved in the carrying on of any business engaging in credit activity”.  

Ms Tonkin called on the government to reform the outdated definition of credit that allowed companies such as these to promote “far reaching and devastating products targeting financially vulnerable people, pushing them further into poverty”.

“We’ve got a definition of credit that has loopholes,” Ms Tonkin added.

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She told news.com.au that clients of the companies are still being pursued by debt collectors for repayment of loans and fees charged.

“We still hear weekly from Cigno clients calling our helplines, who are on Centrelink or very low incomes, with legacy loans, paying eye-boggling interest and penalty fees, lured into disastrous debt cycles.”

A date for the first case management hearing is yet to be scheduled.

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