Timely support for vulnerable as Cash Converters settlement is approved

This is the settlement approval decision of the class action against Cash Converters in relation to loans to people in Queensland.

This is the settlement approval decision of the class action against Cash Converters in relation to loans to people in the Australian state of Queensland, alleging that brokerage fees charged by Cash Converters were unconscionable in breach of the Australian Securities and Investments Commission Act 2001 (Cth) and in breach of the maximum interest cap permitted under Queensland consumer credit legislation.

The proceeding had gone to trial in November 2018, with an in-principle settlement agreement reached between the parties in October 2019.

The evidence disclosed that there were 68,380 eligible class members, who together had taken out 161,200 loans, having been charged approximately $67.4 million in brokerage fees. It was estimated that, assuming that 65-70% of class members participated in the settlement, they would recover approximately 64-69% of the brokerage fees charged.

Justice Robertson’s judgment approving the settlement is succinct, with his Honour approving the applicant’s legal costs (in the amount of approximately $11.8 million), anticipated settlement administration costs (in the amount of approximately $650,000) and the applicant’s reimbursement payment (in the amount of $15,000). His Honour also appointed Maurice Blackburn as scheme administrator, commenting on the firm’s experience in administering settlements in other class actions.

Read more about the Cash Converters class action.

Case details

Lynch v Cash Converters Personal Finance Pty Ltd (No 5) [2020] FCA 389

  • Federal Court of Australia, Robertson J, 24 March 2020
  • Applicant’s Solicitors: Maurice Blackburn
  • Respondent’s Solicitors: Herbert Smith Freehills
  • Applicant’s Funder: N/A

Read more about this case on Austlii: Lynch v Cash Converters Personal Finance Pty Ltd (No 5) [2020] FCA 389

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