Investor Finance wound down

12:00a.m. 5th December 2008

| By Mark Bode

Sunshine Coast mortgage broker Investor Finance has gone into administration amid a slew of accusations by disgruntled former franchise owners and brokers of the company.

Despite going into voluntary administration on Monday, the Investor Finance brand has survived. It was sold to Maroochydore-based Reign Financial in October.

Investor Finance founder Adam Thomas has been hired as a consultant with Reign Financial, which now trades as Investor Finance with former IF franchise owner Kristyn Usher listed as a director.

Mr Thomas said yesterday Reign Financial was established in 2006, although the company is not listed in the phone directory or on the internet and is not a member of the Mortgage and Finance Association of Australia.

He said Reign bought the Investor Finance trademark and all its franchise agreements.

“I had to make a decision on becoming insolvent, so I had no choice but to put the company into administration,” Mr Thomas said.

“The thing that I don’t want to see is confusion about the old company, which is in administration, but the Investor Finance brand has survived and is flourishing.”

In an unsigned letter to the Daily this week, a former Investment Finance franchisee claimed Mr Thomas was trying to get out of outstanding financial obligations by setting up another company.

“I bought a franchise for $27,000 and two weeks later they shut down – and I’m not the only one,” the former franchisee said.

“So many people were financially hurt, and this company is still trading under different directors and Mr Thomas has contracted himself back to IF.”

Mr Thomas, who blamed Investor Finance’s “demise” on the sub-prime mortgage crisis in the US, denied he still owed former IF franchisees and staff money.

He said all Investor Finance franchisees were given the option to join Reign Financial, with about half IF’s former franchisees and staff taking up the offer.

“Certainly a lot of mud has been slung at Investor Finance, which is very unfair in my opinion,” he said.

The Daily reported in October that Investor Finance had closed 12 of its 14 branches nationwide – including five on the Coast – but had been thrown a lifeline after Gold Coast-based Australia Loan Company agreed to buy a stake in the company.

Recent Comments

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Posted by SunMan from Nambour

on 5 December, 2008 at 8:15 a.m. ( Suggest removal )

I'd like the former franchise purchaser/s who have been affected to all step forward and validate their claims.

Mr Thomas most certainly has a right to clear the air - but we as his potential future customers, have a right to know who we're doing business with.

Posted by My_2_cents from Southern end

on 5 December, 2008 at 2:43 p.m. ( Suggest removal )

SunMan, they may not be too keen to "step forward and validate their claims", however, as Mr Thomas et al. don't mind threatening or implying legal action.

I have personally seen his handy-work. Its no wonder so much has been written about his actions and the companies' ethics. He's very protective of his 'reputation', or illusion.

Just a shame they weren't so protective of IF franchisee's interests in the first place.

Posted by My_2_cents from Southern end

on 5 December, 2008 at 4:18 p.m. ( Suggest removal )

Ed, have a look into the management of Reign and then have a look at previous management of IF - you'll see that "due diligence" would have been pretty easy and accessible for the 'new' mob.

Posted by I_wish from Northern end

on 5 December, 2008 at 6:54 p.m. ( Suggest removal )

I am a former IF franchise branch owner & broker & I am still owed money. I was told by Adam Thomas that my commission & trail would be honoured last month, however as I had not paid the $1000 per month marketing fee demanded for the previous month, under the "old IF", I was sent an invoice from the "new IF"/ Reign Financial, & my commission & trail were never paid. My attempts to communicate with them about this have been ignored by Mal Cayley (GM), Adam Thomas & the accountant still working there. I know this has happened to other brokers as well.
Reign Financial have started trading as IF with a "clean slate" as they promoted it to staff, however broker's who still owed the old IF money (esp for services that were never delivered), have been sent invoices & some even harrassed on the phone to pay up! Where is the justice & integrity in this?
I owned a franchise branch with IF & only opened the new office 4 months prior to IF closing. Do you think they would have known they were in financial stress then? Why was I not warned to wait a while? It would have saved me over $100K in new fitout, furniture & staff wages, not to mention my franchise fee of $90K - all gone! So Mr Adam Thomas, you do owe me - big time! Plus, 2 brokers in my team alone, had only just paid their licencee fees literally 2 weeks before IF closed! Some work ethic!

Posted by SunMan from Nambour

on 6 December, 2008 at 12:51 a.m. ( Suggest removal )

I_wish from Northern end - I'm very sorry to hear that. I mean , worse could happen - you could be dead, but that is a nightmare situation. I wonder if Reign is under Choice Aggregation Services too and if so, how that organisation feels to be associated with that kind of activity from operators who are not even members of the MFAA? That certainly would affect their accreditations with lenders and their service agreement with Choice who require MFAA and COSL membership, this in turn perhaps affecting the validity of any agreement with franchise owners and brokers as they are in breach themselves? As members of the MFAA or FBAA - affected brokers could approach them to ensure that the "new outfit" cant just set up and trade away without having the necessary credentials. Ethics and propriety should also extend to include how brokers are treated too as it appears you people have been dispensed as excrement... so much for "cleaning out the industry of rogue operators".

Posted by bjskuse from Adelaide

on 22 March, 2009 at 3:27 p.m. ( Suggest removal )

Helping Australian Franchisees

www.cheesecakeshoplies.com

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