Radio Rentals to refund millions to customers

ASIC today announced a package of regulatory outcomes against Thorn's (Thorn Australia Pty Ltd's) consumer leasing businesses Radio Rentals, RR and Rentlo Reinvented.


To address past poor conduct and protect future customers the company will refund $6.1 million to customers and write-offs default fees, and provide an additional $13.8 million in customer refunds of excess lease payments.


Today, ASIC has lodged civil penalty proceedings with the Federal Court of Australia, in which Thorn has admitted to four contraventions by Radio Rentals of the National Credit Act in respect of each of the 278,683 consumer leases which it entered into in the period from 1 January 2012 to 1 May 2015.

These contraventions relate to the responsible lending obligations of lease providers which require them to make inquiries and take steps to verify the consumer’s financial situation, in order to assess whether the lease is suitable for the consumer, before it is entered into.


ASIC and Thorn will file a Statement of Agreed Facts in the Federal Court , and will make joint submissions that the appropriate penalty to be paid by Thorn is $2 million. The penalty amount payable by Thorn will be determined by the Court.


In addition, ASIC has accepted an Enforceable Undertaking (EU) from Thorn, to further address ASIC's responsible lending concerns and to address concerns about Radio Rentals accepting and retaining excess payments from customers that were more than the lease required.


Radio Rentals has already returned approximately $11.8 million of the $13.8 million to customers who overpaid.


Under the terms of the EU, Radio Rentals will:

  • refund or write-off approximately $6.1 million in default fees and charges relating to an estimated 60,000 leases as a result of the responsible lending conduct which is the subject of the civil penalty proceedings.
  • hold the balance of both the responsible lending refunds and the overpayment refunds that cannot be returned to customers in trust and ultimately donate it as a community benefit payment if the money is not claimed.
  • appoint an independent expert to review its compliance with obligations under its Australian credit licence (including general conduct and responsible lending obligations) and oversee the refund program.

In addition, in response to ASIC's concerns about Radio Rentals' contracts containing terms that may have led to poor outcomes for consumers, Radio Rentals will:

  • roll out a new plain English lease contract by 1 June 2018
  • work with ASIC to improve communications with customers whose leases are ending or have ended, about exercising their end of lease options.

Acting ASIC Chair Peter Kell said: 'Consumer lease customers tend to be vulnerable consumers in tight financial circumstances.

'To all customers renting goods, check your contract to see what your options are at the end of your lease. You may be better off buying the good cheaply than continuing to pay your regular rental payments. You could end up paying much, much more than the product is worth.'


Consumers can use the rent vs buy calculator on ASIC's MoneySmart website to compare the cost of a consumer lease with the cost of borrowing the money to pay for the item instead. ASIC's MoneySmart also has information about low-cost credit options such as No or low interest loans.

Radio Rentals will be contacting customers that are eligible for a refund. Customers with questions or concerns can contact their closest Radio Rentals store, call the customer support line on 1800 464 732 or register their contact details at:


23 January 2018.