Loan shark profits from Aboriginal welfare

Issue 

The January 15 Australian reported that outback prospector Sam Tomarchio had "struck a new kind of gold in Western Australia by taking control of Aboriginal Centrelink payments".

Tomarchio takes possession of Aboriginal welfare recipients' bank cards and PIN numbers. The article reported that he often lends people $3000-$5000 a day, and his interest rate is 33%, "sometimes more".

The article said: "He knows the intimate details of their lives, including the days each month they receive money from Centrelink; this is especially important so he knows when to crank up his EFTPOS machine and get back the money he is owed — plus interest."

When the Australian questioned Tomarchio about his dubious business, he said: "The thing you need to understand about these people is that, unlike you and I, they don't do anything for their money and they have no respect for it."

The "one-man bank" apparently breaks no laws, however the day after the story broke, the Australian reported that state and federal governments would hold "crisis meetings" in an attempt to crack down on the practice.

A letter of complaint from Ngaanyatjarra woman Meredith Simms to the WA commissioner for consumer protection said: "I did not get any paper from Sam Tomarchio about how much I borrowed, how much I had to pay back or how long I had to pay it back.

"I gave him my keycard and PIN number and he took his money out of my account."