Discover how Access Intell helped a well-known asset finance lender dramatically improve PPSR compliance.
Risk teams in banks and finance companies all across Australia believe they’re PPSR compliant. They got the best legal advice. They have world class IT divisions and systems that appear to be processing in accordance with that advice – but are they fully compliant?
How do they know?
The reality is that they often don’t. Un-validated data input at origination (such as within a motor vehicle dealership) leads to the automatic creation of a PPSR registration at settlement.
In many cases, neither the IT people nor the risk and compliance teams know how to check the registration or measure PPSR accuracy. They receive a PPSR number and hope it’s right – but certainty eludes them. Doubt grows along with their book and increasing exposures – until the inevitable occurs.
Claim rejected!
It is likely that most, if not all financiers, will have had enforcement claims rejected in the past. For some, it’s a daily occurrence rendering a high proportion of their lending ‘unsecured’. Embarrassingly, it’s become common knowledge amongst insolvency practitioners that certain lenders are more likely to have their PPSR registrations wrong than right. Liquidators rub their hands with glee at the prospect of the high volume of valuable windfall assets coming their way.
Around 80% of PPSRs are fatally defective
One such lender suffered a series of rejected claims and engaged Access Intell to assist. Access Intell’s analysis of the lender’s active registrations found around 80% incorrect and unenforceable.
Unfortunately, this type of result is not uncommon. Access Intell’s founder Lynne Walton has been an expert in PPSR processing compliance since she left the insolvency profession in 2010. Lynne has specialised in advising all types of secured parties, including big four and second tier banks and multiple finance companies on PPSR policies and processes to ensure practical implementation of their legal advice to achieve the highest possible level of accuracy and compliance.
Alongside errors, Lynne has uncovered many incredibly surprising situations including:
- One secured party’s automated processing system creating 800+ identical registrations for thousands of individual loans.
- One finance company had the personal name of a member of their IT department as the secured party in thousands of registrations.
- One bank had no visibility over what it processed to PPSR. To ensure compliance it performed PPSR asset serial number searches on every asset financed the previous day
Unbelievable situations like these are all too common.
PPSR is complicated but not impossible
One Head of Risk asked the question: “This is an administration task – how hard can it be?”
Lynne’s answer is that it’s not hard provided proper policies are in place, staff decisioning is minimal and the systems being used are up to the task. Access Intell’s PPSR platform validates assets, grantors and profiles to ensure the risk of error is minimal. It caters to multiple secured parties, grantors, and all collateral classes and types. It provides visibility and control over what’s processed and can cope with high volume uploads and feeds both with validation.
Almost 80% of errors reduced to near zero
Access Intell’s PPSR platform was deployed within the lender’s process. This immediately identified and corrected systematic and profile errors as the initial step. Stage two involved incorporating validation into both assets and grantor. The final stage involves the Access Intell platform presenting a manageable amount of errors identified at the final pass prior to processing.
Today this financier automatically processes two feeds (one commercial and one consumer) twice a day and manually corrects less than 10 registrations per week. These are usually watercraft HINS which fail configuration compliance.
It is very pleased with the service and has not had any enforcement issues since engaging Access Intell.
Access Intell
Access Intell occupies the unique position between competent PPSA lawyers and the handful of businesses that commercially process PPSR transactions. It understands both the intricacies of the law and the practicalities and limitations of the register.
Its advanced PPSR platform processes all types of registrations with built in validation, giving lenders visibility, control and confidence over this important function.
Access Intell undertakes PPSR compliance reviews for lenders as part of its onboarding process.
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