The Federal Court has found Diamond Wheels Pty Ltd, trading as Lansvale Motor Group, and Keo Automotive Pty Ltd provided car loans to consumers without a credit licence and charged consumers unlawful and excessive interest charges.

In proceedings brought by ASIC, Justice Lee last week also found Ken Keomanivong, a director of Keo Automotive and former director of Diamond Wheels, liable for his involvement in the conduct of those companies. The Court found that Mr Keomanivong played a central role in setting up the unlawful loan businesses and arranging the hundreds of loans the companies provided.

Diamond Wheels, Keo Automotive and Mr Keomanivong admitted the contraventions, following 19 months of litigation.

The contraventions denied consumers important protections under the credit legislation and are alleged by ASIC, in many cases, to have resulted in almost double the lawful amount of interest being charged to consumers.

ASIC Chair Sarah Court said, ‘Consumer protections under the credit laws are not optional. This is the first civil proceeding ASIC has commenced to address unlicensed credit activities by a car dealership, and it sends a clear warning: dealers that offer finance without the proper licence can expect ASIC scrutiny and enforcement action.’

A further hearing on penalty and other relief is scheduled for 20 August 2026.

Background

Diamond Wheels, trading as Lansvale Motor Group, operates a new and used car dealership in Cabramatta, in south-west Sydney. The business has been family run since about 1995. It is one of Australia’s largest family-owned motor dealerships.

Mr Keomanivong was a director of Diamond Wheels from March 1995 to July 2024. He has been a director of Keo Automotive since August 2019.

Neither Diamond Wheels nor Keo Automotive has ever held an Australian Credit Licence nor been authorised to engage in credit activities. Notwithstanding this, the companies provided car loans to consumers at different times between 2014 and 2024.

ASIC’s case against Diamond Wheels concerns its conduct from September 2018. From that time until December 2019, it was the credit provider under 205 credit contracts and received almost 6,000 unlawful payments under those contracts.

From January 2020 to August 2023, Keo Automotive provided credit to consumers under 119 loan contracts. Between December 2019 and April 2024, it received almost 18,000 unlawful payments under those contracts and many of the contracts entered by Diamond Wheels. Diamond Wheels and Keo Automotive engaged in those credit activities without holding an Australian Credit Licence authorising them to do so.