“I hate to say it but, everything comes to an end, sometimes for the better sometimes for the worse."
Wayne Ormond blames banks for Refund collapse – after pocketing consultant fee from administrators
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Refund Home Loans boss Wayne Ormond has blamed the banks for the October 2011 collapse of his Brisbane-based mortgage broking empire.
Ormond compared his experience of dealing with the banks to swimming with sharks and claimed that “partly due” to Refund’s “restrictive banking facility and poor relationship with my bank” he had no other option than to put the business in the hands of administrators, leaving 119 creditors owed a combined $9.7 million, he writes in an article penned for BRW magazine.
Official documents obtained by Property Observer show that Ormond was paid a consultancy fee over the nine months Refund Home Loans was in administration while his franchisees were not paid trail commission for the loans they wrote over this period.In May Property Observer reported on the jet-set lifestyle Ormond once enjoyed (including owning three Rolls-Royces) while he also came under fire from Aussie Home Loans boss John Symond after Refund collapsed, who called the business model "fundamentally flawed".
The latest revelations that Ormond was being paid following the collapse is expected to gall many former franchisees who chose not to sign up with Home Loans Limited and have lost their rights to trail payment, but who continued to operate as normal to help the administrators to secure the sale of the business.
Minutes of a creditors' report dated June 29 reveal that Ormond was paid “a consultancy fee each month” the company was in administration.
According to the minutes of an earlier creditors meeting in late May, both Ormond and Refund accountant Kok Siew Lim continued to provide services, which would be terminated “upon settlement of the sale”.
At an earlier creditors' meeting in March, administrators were also asked why an unnamed director continued to be employed.
The explanation given by joint administrator and chairman David Stimpson was that it was necessary “due to his understanding of the business and also [as part of] a compliance program that needed to be adhered to”.
Stimpson was also asked why franchisees who chose not to sign up with Home Loans Limited were not reimbursed for the trail commission payments earned while writing loans while Refund was in administration.
“They chairperson advised that because they had terminated, they have forfeited their right to the trail and as such no trail will be paid to them.”
Trail commission payments are monthly payments paid by lenders to mortgages brokers at a rate of around 0.15% of the value of the loan.