The most shocking thing about the Banking Royal Commission is how shocked so many profess to be by its findings.
The grandly titled Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry is, daily, hearing more outrageous examples of financial institutions’ shameless fleecing of their clientele.
The most recent instance being news this week that Australia’s largest wealth manager had charged clients fees for advice they didn’t receive, lied to ASIC about it 20 times and then doctored a so-called “independent” report by lawyers Clayton Utz into the matter. AMP explained to Commissioner Kenneth Hayne that it prioritised shareholders’ interests over clients’.
As so many have said they were by the Commission’s revelation, former Labor MP Bernie Ripoll declared himself “shocked” by the affair:
“I thought I couldn’t be shocked, but I was wrong. I think all the misconduct that’s coming out from the Royal Commission demonstrates why the banks and others pushed so hard against it. It shows they’ve been having a lend of everybody — of their clients, of the government and of regulators.”
Yes, Bernie is right, the money lenders are having a lend of us — but “shocked”? If he was shocked, then he simply can't have been paying attention.
You obviously haven't been paying attention. @independentaus has been reporting on this and much worse banking fraud and corruption for years.— Dave Donovan (@davrosz) April 18, 2018
INVESTIGATING BANKING CORRUPTION AT IA
Anybody who has been following Independent Australia since we began our journey of investigation on 24 June 2010 could most certainly not have been in the slightest bit “shocked” by what we have heard lately the Royal Commission. IA has done literally hundreds of stories on systemic corruption and criminality in the banking and finance industries.
Without doubt our most important contributor to this effort has been Australia’s leading banking fraud investigator, Dr Evan Jones. His exposés have, in vivid detail, uncovered a web of systematic malfeasance that extends throughout our society. But Evan has not been the only one. Also providing important detail to IA’s vast tapestry of banking badness has been contributing editor-at-large Tess Lawrence, exceptional business journalist Michael West and dozens of others contributors.
Indeed, banking fraud and wrongdoing is the number one source of complaint IA receives from the general public — well in front of government corruption, legal malpractice and health industry concerns.
The problem is shocking, but it is also so immense and well-known, no-one whose eyes are open should be “shocked” by the revelations of the royal commission. The evidence of systematic, industry-wide misconduct and organised criminality has been public knowledge for years, has been reported on us and others and, indeed, has been the subject of untold numbers of government inquiries. However, because the finance industry is so intrinsically enmeshed with the political and institutional establishment, not only has a blind eye been turned towards this corruption, but it has been given a leery wink and nod.
WIDENING THE TERMS TO INCLUDE THE CRONIES
The Turnbull Government said they didn’t want an inquiry into banks because it would undermine confidence in the banking system. That is like not wanting to prosecute the mafia because its criminal activities are well-organised and orderly. The Government was dragged kicking and screaming to this latest inquiry simply because they decided they would prefer one in which they had some control, rather than one determined by the Opposition, crossbenchers and a couple of Coalition rebels. Now that we have one, Treasurer Scott Morrison wants plaudits that its scope does not just include banks, but also financial planners and superannuation funds. He can’t have it both ways.
In fact, Morrison should be condemned for not making the terms of reference wider than he has. The financial services industry extends into every section of society. Every individual and business in Australia has a bank account. Most also have loans, credit cards and investments, amongst other financial products. This means banks have a vast range of ways to encourage, reward or punish virtually every single one of us, should they choose to do so.
Therefore, the Royal Commission should have also been tasked to look into the financial industry’s connections to legislators, regulators, judges, lawyers, accountants, liquidators, the police, the media and, indeed, all the other important and influential sectors of our society. All of these important institutions have, in one way or another, enabled and greased the wheel for the big banks' reign of terror over ordinary Australians for so many years.
The actions of the big banks are so far-reaching and systemic, it can only, really, be compared to an enormous and immensely successful organised crime network. And in the same way crime fighters might look to identify and root out influential mafia associates wherever they may be, so should the Royal Commission be allowed to investigate the enablers of finance industry crime throughout our society.
Some of the country's most senior executives have been warned by Treasurer Scott Morrison, that lying to the corporate cop could land them in jail. It follows admissions from AMP at the banking Royal Commission. pic.twitter.com/peZP1kAVWH— NBN News (@nbnnews) April 18, 2018
BIG TOBACCO AND THE GRATIS LIST
Back in the early 1990s, fresh out of university, I worked as an assistant accountant for a large cigarette company. It was the worst job I ever had, but it did provide me with some important early insights into the way the world works. I wrote about how the cigarette company would give us free cigarettes every month keep us or people close to us hooked.
But staff weren’t the only people they gave cigarettes:
The cigarette company’s generosity didn’t end with its staff. They also had a “gratis” list — a list of people to whom they would cheerfully post in the mail, in brown paper covered packages, hundreds and even thousands of free cigarettes and/or cigars each month.
The people on this list comprised the “A” list of Queensland decision makers and influence peddlers — everyone from politicians, mayors, judges, QCs, leading public servants, actors and any other significant or influential person across the state who happened to smoke.
At the time, as a lowly accounts assistant, I thought the company did this because they were just being nice — maybe this was how the recipients of this patronage passed it off. To me now, however, it seems obvious that the goal was, first of all, to keep these powerful figures hooked on nicotine; and, secondly, grateful towards the tobacco industry such that they would consider long and hard before making any decisions that might negatively impact upon these concerns. Drug peddling and bribery — all rolled into one.
I would like to know if, similar to Big Tobacco, the big banks have a VIP list of influential people who get preferential treatment. I suspect they do. And if I’m right, this would go some way to explaining why the big banks are so powerful, influential and totally out of control.
JUDGING THE BIG BANKS
It might explain, perhaps, why judges consistently decide in favour of banks even where banks have been shown ‒ as we have seen in reports in IA ‒ to have acted in bad faith, broken the terms of their covenant with customers and even falsified documents and lied under oath. Is it an old boys club thing? Or could it be, perhaps, that certain members of the judiciary are routinely provided with “gratis” by financial institutions — given “mate’s rates” and gold-star treatment by private bankers. In this way, justices may be groomed by the banks to see them as “good” and worthy friends; pillars of the community.
Bit late tweeting but... “The heavily compromised report into AMP's practice of charging customers for services it did not deliver went through 25 drafts and was the subject of more than 700 emails between AMP & [report writer] Clayton Utz” 🤦♀️ https://t.co/jLiUiPzxQQ— Katie Walsh (@katiepwalsh) April 18, 2018
And, as the biggest companies in Australia, banks would also be among lawyers’ biggest cash cows. Could that be why so many lawyers “run dead” when representing ordinary Australians against the big banks? Could it be why, as the Banking Royal Commission saw this week, “Big Six” law firm Clayton Utz provided 25 drafts of a purportedly “independent” report for ASIC to AMP senior management for them to doctor and finesse? So far, we have seen little adverse comment about Clayton Utz’s complicity in the AMP scam.
As for our Federal politicians ‒ especially the conservative ones ‒ a great many are huge investors in the property market. Could it be they also mysteriously receive preferential interest rates and fee structures on their loans — so long as they keep toeing the line. Such benefits would not appear on a politician’s pecuniary interest register, so how could we ever know?
The Banking Royal Commission should be allowed to follow the money trail to see just how high and wide the finance cancer has spread. Until then, we suspect that whatever “shocking” revelations the banking royal commission uncovers, and whatever slap on the wrist or further modest regulation the industry receives afterwards, the banking mafia and its criminal associates will continue to hoodwink, scam, rob and extort individual ordinary Australians. And they will get away with it, too ‒ almost all the time ‒ completely scot-free.
This editorial was originally published as part of the Independent Australia weekly newsletter. These editorials are usually only available to subscribers. It takes less a minute to subscribe to IA and costs as little as $5 a month, or $50 a year — a very small sum for quality journalism and many great extras.
The editorial on the banking royal commission is a bit longer than I'd planned, but is finished now. So, the @independentaus weekly newsletter will be going out to subscribers in the next hour.— Dave Donovan (@davrosz) April 18, 2018
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