(Image by Firesam! / flickr.)

Dr Evan Jones explores a legal system that views signing a contract of their own “free will” as evidence that foreclosed bank borrowers are victims of their own incompetence.

Count the financial loss, then the intangible emotional trauma

THE Financial Services Royal Commission has a long way to go.

One dimension of bank malpractice that has been off the radar is the trauma suffered by the victims. Long-term trauma, permanent trauma. The media shock, horror sound bites don’t do justice to this widespread nightmare.

One NAB victim notes,

“We know about post-traumatic stress disorder in military personnel after experience on the battle frontline, but no-one talks about PTSD affecting victims of the corrupt financial sector in Australia.”

Small business and farmer victims, and selected mortgagors have lost everything. But beyond the financial loss is the ensuing psychological and physical damage. 

Some people commit suicide. Family coherence is destroyed, with family members becoming estranged. Marriages regularly break up. Some marriages survive but they are often broken. Moreover, the trauma is bequeathed to the next generation at the least.

Victims face a dilemma. Does one fight on to try to recover some of the losses? Does one fight on to help the general cause? Or does one give up and attempt to save oneself and one’s family from further harm? Can one keep up the fight but with relative detachment?

Why the trauma?

Previously functioning vibrant people ran previously functioning businesses. There will be ups and downs in business conditions, but one learns to cope. Save that bank lenders perennially use the poor times (not that they need an excuse) to default and foreclose.

Then one loses the lot financially. But there is the nature of the default and foreclosure apparatus and its subsequent “legitimation”. It is hydra-headed, brutal and sadistic.

Bank default is only the beginning. Though immensely powerful, the bank lender needs an entire apparatus to effect the dirty deed.

The legal “profession” is central. It appears lawyers who work in bank litigation are often corrupt. It goes with the job. Myriad lawyers and law firms have built profitable businesses on their complicity. They are on the front line to savage the victim.

Victims perennially find that their own lawyers – at the time draining their last shekels – are working for the other side. This discovery really knocks the victim’s head around.

Banks force victims to pay for “consultants” and an endless round of valuers do the bank’s bidding, while the payee perennially doesn’t even get to see the reports they paid for.

Liquidators savage the wounded business, perennially consigning the lifeless body to the graveyard out of malice. They operate under direction and protection of the bank, although the law has it that the liquidator is an agent of the borrower. (Spender J does somersaults on this farce in NAB v Freeman, FCA 244, 12 March 2002.)

The regulators fail the borrower. ASIC tells the borrower complainant to bugger off, lying to them in the process regarding their powers. This practice is so institutionalised and the signatories so numerous that the cynical culture is evidently deeply entrenched.

The Financial Ombudsman Service (FOS) messes victim-complainants around, threatens and ultimately sells them out. This institution is there formally to offset the unequal power of the bank lender, but it reinforces the power and bastardry of its banking sector funders.

This complicity by the top finance sector policeman and the “external dispute resolution” mediator is another mind-bender for the victims. This is “nails in the coffin” stuff.

The legal apparatus and the court system

Then there’s the court system. Everything about court procedure is terrifying to the novice. The victims are the guilty parties by construction. The judge pontificates, rambles, diverts. The judge might even admit to banking with or holding shares in the bank that is party to the litigation and then move swiftly on. The bank’s barrister intimidates.

Witness the trajectory of J.A. Sackar. As counsel for the CBA in Dwyer v CBA (NSWSC 50463/90), Sacker brutalised the hapless plaintiff, foreign currency borrower Geoff Dwyer. The inquisition is outlined in my 2005 paper on the trial here. I struggled through the lengthy transcript of this trial in the early years of my exposure to bank corruption and it made me sick.

At the swearing-in ceremony of Sackar in 2001 for his elevation to the NSW bench, Sackar claims as a colleague in chambers one Doug Staff who presided over the Dwyer v CBA trial. It is not inconsequential that the Staff AJ 18 October 1991 judgment (publically unavailable of course) was risible.

Fast forward to the post-GFC era. The CBA, having screwed hundreds of borrowers in its 1980s flogging of dodgy foreign currency loans, was now in court over having screwed hundreds of Bankwest customers after the CBA’s takeover of Bankwest in December 2008. The bank was picking off foreclosed borrowers one by one, thanks to total inaction by the authorities. We now have Sackar J doing the honours, presiding over CBA v Shannon (NSWSC 1076, 12 August 2013) in which he decides … for the bank!

Melbournian Tess Lawrence has been brutalised by the NAB and its collaborators — lawyers, judges, the bankruptcy trustee, the Melbourne legal fraternity acting en bloc, real estate agents and auctioneers, police and select Victorian politicians. Parts of her story are told in her articles for IA of December 2011, March 2012 and May 2012.

Lawrence was induced into a loan arrangement in December 2006 by a loans officer who ignored procedures and which was predatory in essence. Promises were not kept and she was set up to fail. While fighting the NAB over possession of her properties, the NAB consistently played dirty with document discovery. Photocopies, fabricated documents – even blank pages – were standard fare.

The courts have accorded Lawrence her rights on only one occasion, when Beach J, 24 March 2011, granted her leave to appeal against the NAB’s demand of summary judgment for possession. Curiously, that judgment is missing from the public record. In the process, she has been abused and humiliated by NAB lawyers Turks Legal.

McKean Park Lawyers, in collaboration with the NAB, sought to undermine Lawrence’s appeal by suing her for bankruptcy over a fabricated debt. Bizarrely, Lawrence had previously had a collaborative relationship with McKean Park Lawyers, some of it pro bono, with the law firm owing her money.

When seeking a rehearing on the bankruptcy matter in the Melbourne Magistrates’ Court on 9 May 2011, she received violent abuse and a death threat from a hysterical McKean Park Lawyer during an adjournment. Complaints to the presiding Magistrate Braun and superiors were ridiculed. Braun said that he was not interested in what went on outside the court. Braun also claimed that to accede to her request would be, in effect, “tantamount to opening the floodgates to self-representing litigants”. The Chief Magistrate’s office refused to preserve and provide a copy of CCTV footage of the tirade, claiming in writing that CCTV footage doesn’t prove anything.

This attack sent her into a spiral of depression, certified as suffering from post-traumatic stress disorder (PTSD), the after-effects from which she has never recovered. In the first instance, she was unable to conduct her own defence (not being able to afford representation) and her absence was used to ignore her legal rights.

Gardiner J refused an adjournment of the Beach-ordered trial, delivering possession of her properties to the NAB in November 2011, in her absence due to sickness. A court-ordered psychiatric assessment of Lawrence was performed but the expert advice was summarily dismissed. The court registry, also complicit, long delayed delivery of the Beach Trial transcript and has denied Lawrence a complete transcript of the Gardiner Trial hearings.

In the meantime, the Law Institute of Victoria (LIV) took Lawrence’s litigation documents from a private filing cabinet in the office of a friendly solicitor. They have ignored Lawrence’s demand for their return. The Law Institute’s lawyers happen to be McKean Park.

The NAB has subjected her to perennial harassment — surveillance, and computer and phone hacking. The threats to family and friends continue.

Why the ferocity of the attack? Lawrence, as an investigative journalist, had documents related to the NAB’s relationship with known criminals. This material was among those stolen by the LIV. Cui bono?

Lawrence highlights how much time and resources have to be permanently devoted to one’s medical care in surviving this experience.

Tasmanian Suzi Burge is a victim of the CBA, its lawyers and the Tasmanian judiciary — all part of a small town cartel brought together to steal her property and endorse that theft, and subsequently destroy her emotional wellbeing.

Burge had a mortgage over her residence and an investment property, by which she financed a commercial property unencumbered from which she and her then-husband ran a business. The CBA induced her to switch that mortgage to them with the offer of a better deal, which never arrived. Burge sought an additional loan from the CBA to refurbish her commercial property, but the loan was predatory in character (in-house documentation advised against it). From that corrupt leverage, the CBA proceeded to default their business, taking her three properties one by one.

If the bank had acknowledged its fault and operated with integrity, payments could have been readily restructured (the debt was trivial). Rather, the bank foreclosed and sold off properties at ridiculously low value, manufacturing excessive fees in the bargain.

At a court hearing, Burge holds that she was aggressively threatened by the bank’s lawyer, Philip Jackson SC (since 2009, member of the Professional Ethics Committee, Law Council of Australia), in the jury meeting room. She was simultaneously sold out by her own lawyer, who charged her megabucks for the privilege. The lawyers jointly pressured her to sign a fraudulent deed of settlement in March 2016, under duress, involving an impossibly short repayment schedule of a manufactured debt. She was doomed from then on.

The March 2016 trial gave the bank her properties on the strength of her “consent” in signing the deed. A November 2016 hearing, presided over by Blow CJ, refused to overturn the previous judgment. At one stage, Blow joked that in court, the loser pays.

Blow had, as barrister, previously acted for the CBA. His office acknowledged that, at time of presiding, he was a customer of the CBA.

In April 2015, Blow presided over the elevation of Jackson to senior counsel, wherein Blow notes:

"The designation of senior counsel is reserved for those whose standing and achievements justify an expectation that they can provide outstanding service as counsel and advisors, to the good of the administration of justice. … The required qualities include skill and learning, integrity and honesty, independence, diligence …"

On Australia Day 2018, Blow was awarded an AO:

'For distinguished service to the judiciary and to the law … to legal education and professional standards, and to the community.'

As a general procedure, judges will ignore the salient details of the particular case, the nature of the contract and the subsequent corrupt foreclosure process, aided by the fact that the bank has invariably failed to discover crucial documentation incriminating the bank itself. The judge will hone in on the fact that the borrower has indubitably signed a contract of their own “free will” and has been in receipt of bank funds that must be repaid.

Foreclosed bank borrowers are thus victims of their own incompetence and deserve no sympathy. This reverse attribution of responsibility adds another layer to the stress.

If the victim is “lucky” enough to go through mediation, the lawyers in collaboration will force the borrower to sign a deed of settlement under duress (“you will never win in court”), “resolving” the conflict to “the mutual satisfaction” of all parties. The bank’s lawyers see the victim as suitable objects for mental torture — treating them as worth nothing, to be trampled on, or, if there is any display of resistance, to be manipulated psychologically.

Confront the significance of a deed signed under duress. The victim is compelled to sign a document wherein the bank denies all the incompetent and corrupt activities and procedures that have led to the victim’s demise. The victim is forced to sign a transparently fraudulent document, knowing it to be full of falsehoods. More nails in the victim’s emotional coffin.

Eviction brutality

Eviction of victims from their premises is a particularly brutal affair. There is much more at work than the mere fact of losing one’s residence. Formally bathed in legitimacy, eviction is essentially a criminal process steeped in thuggery. More sadism at work.

John Carroll created a fledgling mobile phone service company in Melbourne and Sydney in the mid-1980s. He was ahead of the field. He was taken down by the NAB, assisted by Mallesons law firm. Carroll was in no doubt that his destruction was for the benefit of Telecom (now Telstra) — a sizeable NAB client. Carroll was threatened with death on the end of a rifle by a hired goon.

What Carroll most remembered was the eviction from the site at Yarrambat, north-east of Melbourne. In February 1988, the local sheriff, accompanied by prisoners on day release, destroyed the technical equipment and dumped all business and personal property on the adjoining road. Don’t mess with the big end of town.

Tess Lawrence has received physical harassment and harm, and comprehensive looting of all (read all) her personal possessions from her properties by an assortment of goons, sheriff’s team and NAB personnel. The list includes key personal documents, family heirlooms, antiques and a considerable library of valuable books. Possessions were smashed indiscriminately. Her heritage properties in Daylesford and Woodend were gutted and strategically damaged (removal of load bearing fittings and so on), dramatically devaluing the value of those properties.

In the meantime, the NAB had her arrested and forcibly fingerprinted by the police for so-called damage (graffiti) to property still in her possession.

Lawrence was a one-woman band welfare agent, using her properties for various worthy causes. That service has been killed off.

Regarding Suzi Burge, the CBA’s law firm Simmons Wolfhagen, while overseeing Burge’s home appropriation, expressed an inordinate interest in where Burge was living. Burge’s then hideaway was subject to surveillance. One can only rationally infer that the bank’s solicitor was intent on ensuring that Burge was made homeless.

The CBA warned off alternative interested financiers to Burge’s properties. On instructions from the CBA, a thuggish removalist company in July 2016 appropriated all Burge’s property into storage, treating everything as worthless and destroying much into the bargain. The residence itself was vandalised. Storage was to be at Burge’s account.

Under the pressure, Burge’s family has broken up, with a divorce followed by estrangement of her teenage daughter who found the damage to her mother intolerable.

In March 2016, a clinical psychologist concluded:

'As a result of this assessment, it has become apparent that Ms Burge is severely distressed, suffering from severe situational stress, anxiety and depression. On the Depression Anxiety Stress Scale (DASS; Lovibond & Lovibond,1995), she scored in the severe range on all scales. Her current situation is such, that it is difficult to determine when her condition will improve.'

In March 2017, another clinical psychologist determined the following:

'Based on information gathered through assessment and over sessions, it is apparent that Susan meets all Diagnostic and Statistical Manual of Mental Disorders – 5th Edition (DSM 5; APA, 2013) criteria for post-traumatic stress disorder (PTSD) expect for criterion A. Criterion A pertains to the nature of the traumatic event experienced and while the events that Susan has experienced do not fit within this definition (thereby precluding a diagnosis of PTSD) it is apparent that Susan is responding to these events in a way that is similar to someone who has been involved in a life threatening event.'

There is another case, festering for over a decade on the Sunshine Coast, Queensland. The single mother has been the victim not merely of the CBA but of a criminal cabal with close links to the Queensland bureaucracy, a major law firm and the police.

In December 2017, she was forced out of her home by a dozen men and severely beaten up. Some of them were known policemen, without badges.

I have also been privy to a number of cases in which the woman has been subject to fraud by an ex-husband/partner in collaboration with bank personnel. In each case, the woman’s signature has been forged, with dire financial consequences for her including the potential loss of her abode.

In these cases, the trauma is induced not merely by the financial loss and the battle as a lone figure against the other parties but enhanced with the devastating confrontation that the criminal conspiracy involves one’s ex-partner with whom one has shared one’s life.

As one victim noted, misogyny is alive and well amongst the banking and legal mafia.

Bringing trauma in from the cold

Suzi Burge’s second psychologist’s professional qualification regarding “criterion A” is instructive. The manuals for this domain haven’t confronted that victims of financial crime could be experiencing comparable symptoms to which the PTSD label is conventionally ascribed — the dysfunctionality of members of the armed forces, having been on the front lines of battle.

Welcome to the bank victim’s hidden world.

One can’t overstate the loneliness and isolation with which individual bank victims or couples experience the loss of their mental stability and physical health, of their personal integrity, their humanity.

Confront that a major part of this suffering is a result of the corruption and sadism of bank staff and of their enforcers in the dirty deeds. These people do not merely think that this mode of action is necessary for them to “earn” their elevated take-home pay, but they evidently enjoy it. It has become standard business practice in their fields. Presumably, they go home and sleep soundly, come back the next day and do it again.

These people deserve exposure, but we know the behaviours and the outcomes already. It’s not a matter of rotten apples. It’s the system itself. They are all implicated.

Dr Evan Jones is a retired political economist.

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