Royal Commission into Banking Commissioned

Discussion in 'Markets & Economies' started by House, Nov 30, 2017.

  1. House

    House Administrator Staff Member

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    And they’re off... RC starts today on the back of CBA posting $4.75bn profit and ASIC making ANZ/Westpac refund customers $21m as they were not properly conducting credit card limit increases before upping limits.

    Although they won’t be investigating rate rigging, money laundering, mortgage brokers, financial stability or macro-prudential policy and regulation.

    CBA have set aside $500m in anticipation of the fines they’ll receive o_O
     
  2. renovator

    renovator Well-Known Member

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    im not sure anything worthwhile will come of this . just another smoke & mirrors show to make it look like theyve done something then back to business as usual . with a different way to screw customers. You can bet your bottom dollar they will leave loopholes that the banks will dive into after the dust settles.
     
  3. reaver

    reaver Active Member

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    Fining banks in the dollars they create at will.
     
  4. bubblebobble2

    bubblebobble2 Well-Known Member Silver Stacker

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    you can't fine these banks... who's going to feed those fat-cats?! Not the government again....
     
  5. House

    House Administrator Staff Member

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    And the results thus far;

    •almost $250 million in remediation has been paid to almost 540,000 consumers by financial services entities as a result of three particular forms of conduct in connection with home loans”.

    •Around $90 million in remediation has been paid to almost 17,000 consumers by financial services since July 1, 2010 relating to car loans that relied on fraudulent documentation and breaches of responsible lending obligations.

    •Since July 1, 2010, more than $11 million in remediation “has been paid to over 34,000 consumers by financial services entities in response to breaches of responsible lending obligations in connection with credit cards.”

    •Banks have already paid $750 million in remediation for poor consumer credit practices.

    •Add-on insurance will also be discussed during the hearings, with more than $128 million paid in remediation to consumers in connection with add-on insurance since July 1, 2010.

    •“As a result of work done by ASIC since 1 July 2010, approximately $239 million has been repaid to almost 540,000 consumers who had been affected by account administration and processing errors in connection with home loans, such as failures to link offset accounts and failures to apply the correct interest rate,” Ms Orr said.

    •The commission has received a staggering 1894 submissions so far.

    •In the last five years ANZ has acknowledged “at least 20 events of misconduct on home lending and mortgages”, as well as nine events in relation to credit cards, seven in relation to car loans and car insurance and 22 events of generalised misconduct.

    •Aussie Home Loans, owned by CBA, “acknowledged no misconduct in the last 10 years”

    •Citibank admitted to six events of misconduct in relation to credit cards and loan accounts.

    •While CBA has acknowledged some misconduct, Ms Orr said most of the information provided was not in a form that allowed the commission to “understand the type and scale of misconduct”.

    •NAB provided numerous examples of misconduct including errors that caused 178,000 clients to overpay interest, but Ms Orr said the bank did not “grapple” with the commission’s request for a “comprehensive” response.
     
  6. leo25

    leo25 Well-Known Member Silver Stacker

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  7. systematic

    systematic Well-Known Member

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  8. Miksture

    Miksture Active Member Silver Stacker

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    It seems that fines for misconduct are just a cost of doing business. Makes me wonder whether remediation goes far enough. It means that the banks can perform illegal acts and, only if they are caught, have to pay back the money they misappropriated. If they don't get caught then all is good. That means that there is actual profit to be made from making misconduct a apart of their business model.

    For instance, Citibank decided to do a number of illegal acts on my accounts last year. I escalated the issue to the financial ombudsman service but apart from sending Citibank some letters, they could not take further action as Citibank was exploiting loopholes. The loop holes were not technically legal but they were out of the scope of what the ombudsman service could act. No doubt some RC will come along and close the loophole but Citibank will not have to face anything more than basic restitution, which in my case is a bunch of interest I shouldn't have to pay if I am lucky. I believe that the remediation should include punitive damages. Ie not only restore what customers lost but award punitive damages to those customers which make the cheating hurt the bank. IE make it non-viable to act badly as a business model.

    Compared to the US, Australian banking is very regulated which is a good thing. US customers don't have any guarantee that they own any money in the bank where we do. We are luckier but the banks should be more accountable for breaking the law earlier. What is the point of having laws if they are not obeyed and the punishment is no deterrence?
     
  9. reaver

    reaver Active Member

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    As old mate Arnold Schwarzenegger said. "Ignore the naysayers. Work like hell. Trust yourself. Break some rules. Don't be afraid to fail".
     
  10. silver hawk

    silver hawk New Member

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    I got in contact with a lady named Denise Brailey

    If you want to know about the RC and have a solid complaint talk with her. She has been pushing for the RC for years and she has nailed the banks on many occasions on their dodgy dealings. She has appeared on Today Tonight, 4 Corners & A current Affairs, have a look at some of the things she has been saying and it will shed some light on a lot of things.

    But don't contact her for a good old chat, unless it for a donation. She is busy fighting the Banks.
     
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  11. systematic

    systematic Well-Known Member

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  12. Miksture

    Miksture Active Member Silver Stacker

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