Bank bastardry and sadistic criminality laid bare in loans scandal (Part 2)

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Commonwealth Bank CEO Ian Narev says bank customers are "unreasonable"

So much for not needing a royal commission! Dr Evan Jones recounts the war of words at the current banking inquiry between the criminally corrupt CBA/Bankwest and its fraudulently foreclosed borrowers. 

[Read Part One]

Sean Butler is the third of three victims who are key players in the war between the Commonwealth Bank and the borrowers it foreclosed on after acquiring BankWest. He also appeared at the 4 April hearing of the current House of Representatives 'Impairment of Customer Loans' banking inquiry.

Sean Butler fronts Parliamentary Inquiry

Sean Butler was a builder and resort owner in Western Australia. The CBA criminally appropriated and sold off his assets dramatically under value, with the assistance of receivers Taylor Woodings (now FTI Consulting).

Butler was the first victim to appear at the Senate Economics Committee Post-GFC Banking Inquiry hearings, 8 August 2012. That testimony, available on the web, sums up the story, needing little elaboration.

A liquor industry’s site, The Shout, provides further details.

One needs to emphasise persistently that this disclosure by Butler, accompanied later by testimony from select other victims (and of course myriad written submissions), went nowhere. This is a damnable indictment of that Committee’s membership, especially of the Labor members who were then in the governing Party.

The current Inquiry exists precisely because of the failure of that 2012 Inquiry.

Butler’s case reappears, briefly but tellingly, at the 4 April hearing.

From the transcript:

Mr Ruddock MP (Lib): I mentioned to you earlier that we have received a number of letters putting other views on some of the matters that we have under discussion. I noted today that we received a letter from a Mr Sean Butler, who apparently wrote to you on 25 February flagging a number of questions. Have you brought with you an answer to that letter?

Mr Cohen (CBA general counsel): No, I have not.

Mr Ruddock: He does raise issues in relation to requests for meetings. He said that Mr De Luca, for instance, had sent him a letter on 11 March stating, 'We met with you in the presence of an independent person in an attempt to resolve your concerns.' Mr Butler says that that is untrue. A series of other questions have been addressed to us which go to questions of substantial differences of view in relation to allegations made. He said that he sent the letter to you by registered mail. I am just surprised that you have not come prepared to answer the questions.

Mr De Luca (BankWest CEO): I have got a copy of the letter in my response on 11 March. I have responded to Mr Butler, and we are happy to provide the committee with all the documents that support it in terms of the meeting that was held.

Mr Ruddock: You believe that you have further responded to the matters he has raised?

Mr De Luca: Yes.

Member of the audience interjecting...

Chair: Order!

The member of the audience interjecting was Sean Butler, who proclaimed, with respect to De Luca’s reassurance:

“That’s not true. … He hasn’t.”

Butler had also provided the Committee with copy of notes of a 10 September 2012 meeting, on Taylor Woodings letterhead, at which David Nolan, Bankwest head of Legal and Government Affairs and member of the Bankwest Executive Leadership Team, is recorded as directing staff to 

'... sink boot in to customer.'

Ruddock brings up this matter with de Luca, who obfuscates the matter, to which Butler again, from the floor, interjects “Not true!”

It’s no wonder that de Luca’s body language was not commensurate with the CBA/Bankwest stratagem of driving belligerently through the damning evidence.

Symptomatic of the “two stories” of CBA/Bankwest denial and victim counter responses is de Luca’s letter to Butler of 11 March 2016.

De Luca claims (followed by the essence of Butler’s responses):

We also met with you [on 7 November 2012] in the presence of an independent person in an attempt to resolve your concerns.'

But this was only in relation to repayment of alleged debt; the chair was not independent but constrained by Bankwest’s dictates.

In April 2014 we made a written proposal to release you from all the residual debts and liabilities due to Bankwest but you did not take up this opportunity.

Butler disputes the existence of any residual debt; apart from the destruction of a thriving business, even if the assets had been sold at market value there would have been a substantial surplus.

We have reviewed this allegation ["sink boot in to customer"] and do not agree that Bankwest’s Head of Legal sought to take an aggressive approach to dealing with your financial situation.

The facts are indisputable.

Bankwest and CBA are of the view that they have dealt with you in good faith, answered your queries and made a very reasonable offer to resolve the matter.

Butler asks then why are they withholding an independent investigation report on his case initially promised to him.

In response to Butler’s demands for a copy, Bankwest’s lawyers responded, 17 August 2014:

'The report you refer to is a confidential internal report which refers and attaches privileged legal advice, in respect of which our client continues to maintain confidentiality and privilege.'

After the hearing on 4 April, Butler approached the CBA’s David Cohen and Cohen gave him an assurance that he, or someone from the Bank, would contact him that week to discuss matters. No-one from the Bank has since contacted Butler (as with Eriksson above).

The CBA’s big lie and the implausible big picture

This lengthy diversion into three case studies has been necessary as a counter-weight to Cohen’s three-pronged declaration above.

In short, one infers from the victims’ aggregated evidence that the CBA has mounted a massive regime of “misleading and deceptive representation”. The CBA evidently has a well-resourced enterprise to manufacture lies and half-truths and Chief Counsel David Cohen is the front man of this propaganda machine.

There is a curious lacuna in the arrogant defence of the CBA. The CBA’s initial grand claim was that all these Bankwest customer foreclosures are casualties of the downwash of the GFC — property values plummeted across the board and left these borrowers high and dry like dead beached whales.

In the CBA’s claims to the Committee regarding specific borrowers, the details that ought to give substance to the grand claim (customer revenues and payments, valuations, sales at rock bottom prices, and so on) aren’t mentioned. They aren’t mentioned because – as the customers themselves have documented – these specifics reek of malpractice.

What is claimed to be the invisible hand of the GFC is more probably the mailed fist of corruption.

This is the game that the banks have long played in the courts where the banks press to prevent what really matters as being admitted in evidence and the judiciary has been perennially happy to comply. CBA spokespersons presume that they can pull the same stunt with the Inquiry Committee, even though the Committee is confronted with mountains of contrary evidence that sums to an alternative big picture.

The CBA is now run by a mafia, with its somnolent Board ignoring the bank’s crimes. The People’s Bank has become an enemy of the people.

The Australian Financial Review: All the way with the CBA

A sideline to this Inquiry is the slavish devotion of the Australian Financial Review to the bank’s cause.

The title of guest columnist Christopher Joye’s article, 1 December 2015, sums up the line and the content:

'Senate inquiry into Commonwealth Bank over Bankwest is a slur on our biggest bank'.

The first paragraph continues:

'A parliamentary inquiry into allegations the Commonwealth Bank of Australia forced Bankwest borrowers into defaults is a huge waste of time and taxpayer money, has inflicted egregious and unwarranted brand damage on Australia's biggest bank, and risks encouraging reckless lending practices that could sow the seeds of similar crises.'

'Egregious and unwarranted brand damage …'? Hello? We know where to look for brand damage and it isn’t to the defrauded borrowers, investors and insurers whose parlous experience and pressure has led to this and other Parliamentary inquiries.

Ditto for Tony Boyd, in his reporting, 5 April, of David Cohen’s appearance at the 4 April hearing.

Claims Boyd:

It is obvious from Monday's joint parliamentary committee hearings on the Bankwest loan impairments that some politicians will never believe anything the Commonwealth Bank of Australia says. While the CBA has come under legitimate criticism for its financial planning scandal and its treatment of a number of policy holders of CommInsure it is not guilty of the claims made against it by former Bankwest commercial customers. …

Cohen on Monday presented the joint parliamentary committee with a final definitive rebuttal of the conspiracy theory [an incentive to impair loans]. …

It seems to have escaped [Committee member] Ruddock's attention that the Bankwest loan portfolio was a basket case with more non-performing loans than any other bank in Australia.

Joye and Boyd have taken the line of the bank and reproduced it. They have examined none of the claims of the foreclosed borrowers and the details underpinning those claims (readily available in the Inquiry submissions). Sean Butler replied to Joye with the exemplar of his own story in a letter to the AFR on 4 December.

As Boyd’s site notes:

'Tony has more than 35 years experience as a finance journalist.' 

Indeed he has; as a veteran he’s seen everything Australia’s excesses and crisis-driven financial sector has to offer. So why has Boyd not looked behind Cohen’s brazen spiel?

Bliss to be able to get up in the morning and not expose oneself daily to the rag that is the Australian Financial Review.

The National Australia Bank as “good cop on the block”

The NAB representatives rounded off (by teleconference) the 4 April hearing. On the line were Geoff Greene, head of Strategic Business Services, and Tim Armstrong, head of Micro & Small Business South.

Greene and Armstrong trotted out the usual sound bites about (paraphrasing) “working with our business borrowers, ideal co-operative relationships that involve working through and resolving any problems, blah blah”.

Then came an intervention by Philip Ruddock:

"I want to test you as to whether or not you want to continue to be the good cop on the block with admirable performance about which we have not yet received complaint …"

What the …!?

Ruddock had offered the same distinction to ANZ at that bank’s appearance at the 13 November 2015 hearing. That was before the ANZ’s maltreatment of borrowers brought over with the Landmark acquisition had been brought to the attention of the Committee.

I wrote an email next morning to Senator David Fawcett, Chair of the Inquiry Committee, to set Mr Ruddock and the Committee straight on the NAB’s history.

I noted:

'The NAB is far from being a good cop. Indeed, the NAB has been the most consistent practitioner of unconscionability or fraud against its SME/farmer borrowers for the last 30 years, the period for which information is available.'

I also drew to Senator Fawcett’s attention the considerable number of submissions to this very Inquiry from NAB victims, noted HERE.

Which led to another observation from yours truly:

'One knows (as Senator WIlliams points out) that Commitee members are busy people. But the fact that these submissions concerning NAB have not 'registered' in the minds of Committee members highlights that something is amiss — is the Secretariat not summarising submissions for Committee members' benefit? Ultimately, are bank victims wasting their time in making submissions?'

This discovery has a shocking implication. What is the point of victims struggling over submissions, documenting blackguardery, the mere quick perusal of which would highlight that something is rotten in the state of Denmark, if no-one in authority reads them?

The Committee’s report and the Royal Commission hubbub

The Impairment of Customer Loans Inquiry has been generally under the radar at both Fairfax and the television media. Richard Gluyas at The Australian has offered intermittent coverage.

The Committee’s hearings have been drawn out unexpectedly. By coincidence, the forthcoming report will appear in the middle of the hubbub following Labor’s throwing down the gauntlet over holding a Royal Commission.

Whether there had been any interaction between Labor’s relevant front bench and the Labor members of the Inquiry Committee is unknown. But it seems improbable that the Report could not be influenced by the current atmosphere and by the strident stances of the parties to which most Committee members belong. A non-unanimous report, split between Government members and Labor members is not unlikely. But where then would National Senator John 'Wacka' Williams, long an advocate of a Royal Commission, cast his lot?

Whatever the content of the Committee’s report, even if lukewarm, the very delivery of the report from this Inquiry, of which much of the public remains unaware, is likely to add grist to the anti-bank momentum.

The more fuel on the fire under the venal banking sector and its complicit “regulators” the better.

Dr Evan Jones is a retired political economist. He has been writing on bank malpractice against small business and the family farmer for over a decade. Dr Jones appeared on ABC Lateline last night (25/4/16) to comment on yet another disturbing case of National Australia Bank fraud:

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