Question -

Cash Converters is the biggest payday lender in Australia; it is also a public company listed on the Australian Stock Exchange.

In November 2015, a class action was launched against Cash Converters for exploiting and trapping thousands of vulnerable low-income customers in a cycle of debt by charging extortionate interest rates up to 633% per annum and excessive fees on short-term loans.

Required

a) Please explain (i) how Cash Converters' practice that prompted the class action was documented in its annual report; and (ii) whether the practice is unethical. You need to substantiate your answer in (ii) with appropriate ethical theories.

b) Please analyse the financial impacts of the practice on Cash Converters, share price included.

c) Please discuss the social responsibility and sustainability of a financial institution, in general and of Cash Converters, in particular.