Former Goldman Sachs banker Malcolm Turnbull criticised the banks' ethics last week, but quails at the thought of a royal commission

The Government says the banking industry is well regulated and no royal commission is needed. Managing editor David Donovan says they lie.

NO ROYAL COMMISSION into the banking industry is needed, says Federal Treasurer Scott Morrison.

It is already a well-regulated industry, he claims — and anyway, there’s always ASIC.

Said Morrison last Friday (8 April 2016):

“Our banking system is well regulated …. ASIC has the powers of a royal commission, and in fact it has greater powers than a royal commission. What this simply is, is Bill Shorten playing politics in the lead-up to an election on a very, very serious issue.”

He repeated these assertions in a doorstop this morning (11 April 2016). This line is obviously an agreed form of words, since the same formula has been used by key cabinet ministers, including Malcolm Turnbull, Environment Minister Greg Hunt and Immigration Minister Peter Dutton, among others.

There are a number of things that jar about this statement. In fact, it is impossible to see it as anything other than hypocritical, self-serving and profoundly deceitful.

Firstly, on the notion that the banking system is well-regulated. This is utterly disproven by the string of scandals that have been occurring with tedious regularity in this nation. For instance, Westpac joined the Commonwealth and NAB in also being accused of fixing bank bill swap rates just last week. And you could not read the alarming exposes on banking fraud by Sydney University’s Dr Evan Jones in this publication and others without knowing that something is very, very rotten in the banking industry. The dysfunctional and corrupt finance sector is already deeply tainted in the eyes of the public and clearly needs root and branch reform.

And to suggest that the Australian Securities and Investments Commission and the Australian Prudential Regulation Authority would be able – or even inclined − to change this prevailing culture of criminality is either naïve or wilfully ignorant. The latest smokescreen by Treasurer Morrison today, that money will now be reinstated to the corporate regulators to assist them in compliance and enforcement, after both organisations had hundreds of millions of dollars ripped out of them by the same administration in the last two Federal budgets, should be treated with the contempt and derision it deserves.

Secondly, the claim that ‘ASIC has the powers of a royal commission, and in fact it has greater powers than a royal commission’ is correct, as far as it goes. In terms of corporate affairs, ASIC is the direct equivalent of the Australian Crime Commission (ACC), the Federal body tasked to root out serious and organised crime and corruption.

Here’s what Wikipedia said about the powers of the Crime Commission:

‘… the ACC has ongoing powers similar to a Royal Commission including extensive coercive powers. This includes the power to examine witnesses in a "star chamber", with the witnesses being compelled to answer questions of the Commission. These witnesses are served with a summons, which includes a prohibition of telling anyone about the summons….’

In other words, the ACC also has “greater powers than a royal commission”.

So, if the ACC has these powers, then why was a royal commission into corruption in the trade union movement required?

Could it be that establishing the trade union royal commission was

‘… playing politics in the lead-up to an election on a very, very serious issue’?

Indeed, couldn’t proposing to re-establish a kangaroo court, the ABCC, to bully construction unions and threatening a double dissolution over the issue be seen as “playing politics in the lead-up to an election”.

And couldn’t the Government’s recalcitrance regarding establishing a royal commission into the banking industry also be seen as playing politics in the lead up to an election? Especially given the banks are some of the biggest donors to the conservative side of politics?

The squeals of outrage from Liberals about talk of a banking royal commission are themselves outrageous. The hypocrisy, breathtaking.

It’s all very simply really. The unions are the Government’s enemies, so they must be punished and made scapegoats for political ends. Whereas the banks are the Liberal Party’s friends and sponsors – and past (and future) employers – and so must be protected at all costs.

The banks are, as we have shown, corrupt and all too powerful. And our political system has been skewed dangerously by their malign and malevolent influence. Once a banking royal commission is instigated, a Federal ICAC would be a welcome further step.

But a good first step would be voting out this hypocritical, deceitful and politically compromised Government.

You can follow managing editor Dave Donovan on Twitter @davrosz.

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