Labor leader, Bill Shorten, has dialled-up calls for a banking Royal Commission, appearing on Sky TV yesterday to call-out the Coalition’s constant defence of the banks, which he claims is against the will of the electorate. From Adele Ferguson:
Bill Shorten’s comments that the Coalition should “join with us and the voice of the people and have a banking royal commission” will add to the chills already running through the financial services sector…
“Nothing less than a royal commission into Australia’s banking and financial services industry will suffice and it doesn’t matter even if we don’t fall across the line and form a government, but instead we are the opposition, we will be prosecuting the case for a banking royal commission”…
The Coalition underestimated the disquiet among Australians about the behaviour of the banks. This was nowhere more evident than the polls, which showed majority support for a royal commission.
The upshot is only the believers and the gullible bought the Coalition’s arguments. The problem is existing laws don’t provide enough protection against conflicted advice and remuneration, and ASIC hasn’t been able to fix systemic problems in the industry…
Labor’s backing for a bank royal commission is turning into a key strength as most of the minority parties and crossbenchers are strong advocates of a royal commission.
The arguments for a banking Royal Commission are compelling.
First, there’s the recent explosive reports about banks manipulating the bank bill swap rate, which need thorough investigation.
Second, there is the 1000-plus examples whereby borrowers’ loan documentation has been forged by the banks, as revealed by LF Economics’ Lindsay David on Four Corners in May, as well as in LF Economics’ detailed submission to the 2016 Parliamentary Inquiry into Penalties for White-Collar Crime, which provided compelling evidence showing that Australia is a haven for white-collar criminality and control fraud.
Reports of widespread mortgage fraud has also emerged from other quarters (for example here and here).
Finally, there’s the dodgy lending standards underpinning Australia’s massive mortgage debts, as expressed recently by former chief executive of NAB, Don Argus:
What scares the “hell out of” Don Argus, a former chief executive of National Australia Bank and former chairman of BHP Billiton?
Iron ore prices? Interest rate rigging scandals? No. It is interest-only home loans.
“It scares the hell out of me – the size of the debt people are taking on without principal repayments,” he says…
“It used to be very difficult to get a home loan in the old regulated banking environment,” he says. “Now it’s like a commodity”…
While the Turnbull Government claims that ASIC has the powers to investigate these issues, why hasn’t it done so already and where are the penalties?
It seems that a banking Royal Commission may be the only way to get to the bottom of the banks’ systemic dodgy practices. Bring it on.
