SA store owner fined over credit scheme


A store owner on South Australia's Aboriginal lands has been fined more than $160,000 over a dodgy credit scheme.

Over a two-year period between 2010 and 2012, the Federal Court found that Lindsay Kobelt, the owner of a general store at Mintabie, had used a "book-up" system to withdraw almost $1 million from the accounts of 85 customers who had been offered loans to buy second-hand cars.

The court previously found Kobelt's conduct to be unconscionable with judge Richard White on Thursday imposing fines totalling $167,500.

However, the judge stayed the penalties pending an appeal against his original judgment.

Under his scheme, Kobelt provided loans to customers but in return they were required to provide him with a debit card linked to the bank account their wages or Centrelink payments were paid into.

He then used the cards to withdraw all, or nearly all, the available funds before allowing the card owners to have some money back to buy food and other necessities.

"I considered that a number of elements warranted the characterisation of Mr Kobelt's system of book-up as unconscionable," Judge White said in imposing the penalties.

"Mr Kobelt engaged in the conduct over a long period of time and was, when doing so, pursuing his own personal interests.

"His unconscionable system has been the means by which he has derived considerable financial profit."

The action against the storekeeper was brought by the Australian Securities and Investments Commission, with deputy chairman Peter Kell saying the case should serve as a warning to all those in the credit industry.

"This kind of exploitation of financially vulnerable consumers has serious consequences," Mr Kell said.