Urban Rampage, a key retailer for First Nations people in remote communities, is poised to take the Australian Securities & Investments Commission (ASIC) to the Administrative Appeals Tribunal. The company says ASIC is wrong to indefinitely stop Centrepay services, with no reasons given for a delay in making a final decision on an interim stop order first slapped on the business without notice on February 29, 2024.
ASIC has refused to tell Urban Rampage when it will make a final decision on the interim stop order despite the company making multiple submissions, and it never having failed a Services Australia audit since 2016 when the business first started using Centrepay.
The interim order is in effect a permanent ban. "If ASIC doesn't let us know what is happening by close of business Thursday (April 4), we will go to court. The delay tactics and are simply unacceptable and unjust. It's killing a family business built up over decades," Urban Rampage's lawyer Leon Loganathan from Ward Keller said.
ASIC said it consulted with financial advisors before imposing the stop order, but Urban Rampage has heard from over more than 80 upset customers with written complaints, and currently has a petition circulating with more than 700 signatures to bring Centrepay back.
"ASIC hasn't talked to those affected by the Centrepay ban. This is unfair and appears discriminatory and paternalistic. It suggests that First Nations people can't manage their money and make good financial decisions," Mr Leon Loganathan said.
"Other non-Indigenous Australians have many ways to buy now and pay later. First Nations people on benefits don't. In the remote communities, this looks like click and pay for whites only, no credit for black fellas. That's just not right, and First Nations people know it."
See earlier news release here: 'Click and pay for whites only, no credit for black fellas': First Nations shoppers slam ASIC decision to cut off Centrepay
ASIC in breach of Corporations Act 'notice' rules
In a letter to ASIC sent this week, Mr Loganathan said Urban Rampage was committed to a "cooperative approach with ASIC to the extent that is possible" but "we fail to understand why ASIC cannot provide any certainty as to when a final decision will be made".
"ASIC's unwillingness to provide our client any certainty as to when a decision may be made, cause our client considerable concern as to whether ASIC is approaching the decision with impartiality. As you know (or should know), the interim decisions are having a significant and adverse effect on our client and its customers," the letter to ASIC said.
"Our client's business is almost entirely reliant on customers being able to pay using the Commonwealth Government's Centrepay scheme. It follows that the interim decisions are devastating to our client's ability to continue operating.
"Were they to be in place for the indefinite future (which is all that can be ascertained by ASIC's responses to date) there is a real risk that the so-called-interim decisions would have the effect of irreparably harming our client's business. It is in this context that we ask (again) for you to inform us when a decision might be expected from ASIC.
"In the event our client does not receive a satisfactory response by COB on Thursday, 4 April 2024, we reserve our client's rights to commence Court and/or Tribunal proceedings without further notice to you," the letter said.
The letter highlights significant concerns about ASIC's failure to comply with notice requirements for stop orders under the Corporations Act 2001.
"As far as we can ascertain, each such decision is a reviewable decision within the meaning of s 1317B of the Act, which is a matter in respect of which that ASIC is required by s 1317D(2)(b) to notify our client. No such notice has ever been provided," the letter said.
Call for Indigenous Senators to Speak Up
Centrepay is backstopped by the Commonwealth Government. There is a maximum amount that can deducted in any given benefits payment cycle which is $200. Urban Rampage does not charge interest. There are no fees. And at any time a Centrepay user wants to cancel a payment, they can and the deduction stops immediately. The customer can only resume using Centrepay when the debt is cleared.
Urban Rampage has been audited 19 times by Services Australia since it started using Centrepay in 2016. It has passed every audit.
Complaints have flooded in since the ASIC ban.
People can't get what they need. One customer had to drive three hours to find out they couldn't use Centrepay. Another said the ban makes life hard for people in the bush.
Urban Rampage wants First Nations politicians to speak up.
"The ban takes away dignity and choice from First Nations people," Mr Loganathan said.
"By its action, ASIC disregards the voice and needs of the very people Centrepay was designed to serve, widening the gap in financial equity. It is a paternalistic blow that tells an entire community they are unfit to manage their finances through Centrepay.
"It's important we hear from First Nations politicians like Malarndirri McCarthy, Marion Scrymgour, and Jacinta Price as they would be eminently qualified to speak about the demand share economy and the important role the Centrepay deduction facility plays in addressing this issue," he said.
In a statement, a spokesperson for Urban Rampage said:
"Centrepay has been around since 1999 and there have been instances of unscrupulous operators contravening Centrepay's business terms. We are not one of those operators and can confirm that since we registered to use Centrepay in 2016, we have never failed a Centrepay audit. We have always strived to ensure we are on top of all compliance and regulatory matters and even engaged cultural consultants to help us improve our services in Indigenous communities.
"Our impeccable record with Centrepay since 2016 speaks volumes. Under our terms, customers pay no interest, no establishment fee, and no penalty for non-payment. In fact, customers can stop payment at any time without penalty. It gives our customers confidence and flexibility. This is what makes ASIC's actions so disappointing, not just to us but to our customers as well."
Torrent of Complaints
The ASIC Centrepay ban has sparked a wave of outcry from customers who rely on Urban Rampage for essential purchases. The business has received more than 80 customer complaints in less than two weeks expressing dismay and frustration, and 733 petition signatures as of March 15, 2024. In one case, a woman was unable to buy funeral clothes.
One customer said: "Stopping my right as customer to purchase... I drove 3 hrs … to shop just to know Centrepay is not available at the moment."
Another customer said: "This is the only shop where bush people can get their stuff ... stopping Centrepay for them is just like putting bush people's life in difficult situation."
A Tennant Creek customer said: "I am very upset when I went to the shop for shopping today and they said Centrepay is suspended. The shop is being more helpful for us to get our daily needs. It is very unfair for the people like us who are living in a remote area where there is very limited access."
An elderly grandparent said: "We have been using this service for years and cut it out all off sudden … where I can get the clothes, kids stuff? … got three grandkids need underwear, walking on the street naked, there is a family funeral coming this Friday, where I can have these ? Rampage has been doing well with this service … it needs certain time to apply the rules … cut it all of sudden … do I need to Drive to Darwin to get clothes?"
And this from a First Nations person who drove 400km to shop only to be turned away: "Items of Urban Rampage come in handy. We buy here our basic needs like clothing, for the kids and family. Our community is far from Derby and I visit just to purchase our needs. I came here today, travelled 400km, just to know that I cannot use Centrepay in Urban Rampage."
And another: "I am happy to do Centrepay shopping with Urban Rampage. This is the only shop for the community people where we get our stuffs. I have my grandkids ready for school but because Centrepay shopping is suspended for them now, I am unable to get the clothes for kids. This is the only shop where I can buy the varieties of clothes. This suspension made our life difficult."
