There were explosive scenes at the banking royal commission on November 27, during its final days as an audience member accused it of “concealing fraud”.
ASIC a toothless tiger when it comes to the Commonwealth Bank
The banking royal commission was hijacked this afternoon by an outburst from an angry audience member who accused it of fraud.
The man interrupted senior counsel assisting the commission Rowena Orr QC, who was questioning Australian Securities and Investments Commission (ASIC) chair James Shipton.
Royal commissioner Kenneth Hayne QC repeatedly asked the man to stand down without success, and appeared to be thoroughly unimpressed during the tirade.
The man, who had been seated in the public gallery, ranted against alleged corruption within the banking and financial services industries.
Although his words were difficult to hear over the commission’s webcast, he was clearly heard accusing the commission of being “corrupt” and “concealing fraud”.
“Why are you concealing the greatest fraud in this country which is variable interest rate loans?” he said.
Security eventually escorted the individual from the courtroom.
In typical Rowena “Shock and Orr” style, the QC continued on completely unfazed, immediately firing off her next question.
Earlier today, Mr Shipton admitted ASIC should take criminal action against the bigger financial institutions more often, and said the organisation had failed to act against the Commonwealth Bank’s mishandling of consumer credit insurance and National Australia Bank’s home loan fraud.
“Today these matters would be handled very differently,” Mr Shipton said.
“I used the word mistake deliberately because mistake, in effect, constitutes a misguided decision.”
He said ASIC had only just started to take action against CBA in October — more than two years after the bank owned up to the insurance mis-selling.
Mr Shipton, who has been in the top job since February this year, said ASIC had focused on fixing the problem with customers instead of taking action against the bank.
“In some cases I clearly am of the view that we should have tried to and work towards running both remediation program and the enforcement investigation at the same time, in parallel,” he said.
But Mr Shipton insisted ASIC would be pursuing more legal action in the future when faced with banking misconduct.
“I want to make it crystal clear we will be undertaking more court-based actions,” he said.
“We will be more adventurous, as it were, in pushing points of law.
“We will be taking more — let’s call it risks, because we now have, through my direct engagement with the government, more funding to do exactly that.”
The commission also heard CommBank was concerned about being seen as “paying off” ASIC after the bank was let off the hook with a $300,000 community donation — which the regulator agreed with — instead of a fine over misleading CommInsure ads which were found to have breached the law.
“It was a mistake not to act quicker, swifter and earlier,” Mr Shipton said in response.
Ms Orr’s trademark, dogged questioning was on show yet again today, as she repeatedly insisted Mr Shipton answer her questions thoroughly during a number of tense exchanges with the witness.
The inquiry has ended without the Commissioner calling for extra time to examine more than the 27 distressed farmers it heard, out of more than 10,000 submissions it received.
The federal Member for Kennedy Bob Katter on June 25 introduced a private member’s bill into the Australian Parliament to protect the economy and bank customers from dangerous financial speculation and predatory banking.
The Banking System Reform (Separation of Banks) Bill 2018 is based on the USA’s successful Glass-Steagall Act. It will separate Australia’s commercial banks, which hold deposits, from risky investment banking, as well as other financial services that Australia’s banks have acquired in recent decades, including insurance, superannuation, wealth management, and stock broking.
The ongoing Financial Services Royal Commission, which Bob Katter led the political fight to establish, has laid bare the predatory banking practices that the bill will end. The revelations from the royal commission have been so dramatic that it has attracted global attention, and kindled fear in the City of London that Australia’s inquiry could lead to a renewed push to break up Britain’s too-big-to-fail banks.
Katter excoriated Australian banking in a passionate speech introducing his bill. “The situation in Australia is ugly and it is evil”, he said, “and this legislation is needed to overcome those problems and what effectively it says is—‘Mr Banks you are no longer out there in the market, in the arena buying and selling. Your job is to loan to people that buy and sell, develop and invest. You don’t do that, you judge them.’”
Aside from the conflicts of interests in banking, Katter’s chief concern in moving Glass-Steagall is for the looming financial crisis arising from the banks’ speculation in real estate and derivatives. He identified the reckless speculation threatening the financial system today was also the cause of the 1929 crash, which led to the passage of the Glass-Steagall Act in 1933.
“What we’re talking about here is derivatives: when you don’t buy a loaf of bread; you buy a contract to buy a loaf of bread”, he said. “That is what we call a derivative.
“Glass-Steagall came in and it overcame the vast bulk of those problems so that the American economy ran fairly effectively, making it three, four, five times the size of any other economy on earth, until Mr Bill Clinton, ‘Mr Free Markets’ himself. … In 1999, he abolished the Glass-Steagall Act. Within two years, the dot-com collapse occurred, taking down trillions of dollars of savings, superannuation and retirement moneys of Americans and the rest of the world, and in 2008, as we’re all familiar with, came the GFC.
“Clearly, that timeline indicates the necessity for Glass-Steagall legislation in this place.”
The most immediate danger for Australia, Katter emphasised, is from the bubble in the real estate market.
“The housing boom in Australia today—does anyone seriously think that we are not sitting on the brink of disaster?” he warned. “A quarter of Australia’s population, maybe a third, live in Newcastle, Sydney and Wollongong. The average price of a house is over $800,000. That means that 50 per cent of the houses are over that value. Yet the average income for an Australian after tax is about 50 grand a year [$50,000]. So how are they going to make the repayments on a house? And yet they’re buying houses. The banks are financing them. The banks make money when you go broke and they sell the house out from under you. They don’t lose money; they make money out of what has occurred. They should be held responsible.
“I would love to be in a business that is guaranteed by the government”, he continued. “If I buy a corner store and I know that, if I go broke, the government’s going to give me the money, everyone will be buying corner stores in Australia. They are given this, but there is no responsibility placed upon their shoulders to act in a prudential manner.”
Katter singled out the team of people responsible for organising the bill, including Robert Barwick, Dr Wilson Sy, and Bob Butler. Sy is the former principal researcher at bank regulator APRA (Australian Prudential Regulation Authority). Barwick and Butler are representatives of the Citizens Electoral Council, which has led a nine-year campaign to get Glass-Steagall legislation enacted in Australia.
It is significant that on the same day as Bob Katter introduced his bill, Australia’s biggest bank CBA announced it was demerging from its wealth management businesses, as if to send the message that Glass-Steagall legislation is unnecessary because the banks are doing it voluntarily. On closer examination, however, CBA is not completely demerging from other services, and along with the other big banks it is continuing to speculate in dangerous derivatives and other forms of financial gambling. Only a strict Glass-Steagall law will end these practices, which is the intention of the Katter bill.
As a private member’s bill, Katter’s Separation of Banks Bill 2018 will only be debated if a majority of members of parliament agree to do so, which will require the support of one or the other major party. Ordinarily, the governing Liberal Party would be expected to protect the banks, but many Liberal politicians are shocked by the revelations of the royal commission and are concerned about a financial crash. And what about the Labor Party—will it block or delay Glass-Steagall the way it blocked the banking royal commission for six years, or return to its roots as champions of working people against the Money Power? It will be up to the Australian people to demand the major parties stop protecting the banks, and allow a debate and vote on Glass-Steagall.
We will face the crisis with aggression and unity – KAP
Charters Towers Debt Summit August 31, 2015
With less than a week until the Charters Towers Rural Crisis Summit, Member for Dalrymple Shane Knuth said he has felt a groundswell of interest.
” Since we announced that a summit would be taking place I have been fielding calls from graziers and small business owners in drought effected areas all over the state,” Mr Knuth said
“The amount of people who are getting involved in this is encouraging, the rural crisis really is the issue of our time.
Mr Knuth who will be chairman on the day with KAP member for Mount Isa Rob Katter said while the speakers at the summit will help bring context, it is a priority locals are given the opportunity to speak.
“The summit is important but the action that follows after is essential,” Mr Knuth said.
“The resolutions devised and agreed upon at the summit will form a blue print for action in rural Queensland.”
Member for Mt Isa Rob Katter who held a similar summit in Winton last year said the rural crisis committee which has since become the backbone for rural advocacy in the area.
“Less than a year on the committee has been instrumental in applying strong pressures to the government in face to face meetings, but we aren’t done yet,” Mr Katter said.
“There needs to be a stronger and more direct connection with between the cattle producers, business owners and the policy makers, we are trying to facilitate this.”
KAP Federal member for Kennedy Bob Katter who will also be part of the day has widely encouraged people from all walks of life to join to help find a solution.
Mr Katter said the current high price of cattle due to the lack of stock available isn’t a consolation for struggling farmers because they themselves have no cattle to sell.
“There are answers here, and we have got to go to those answers with aggression and unity,” he said.
“Wandering around blaming political parties quite frankly isn’t going to get us anywhere, there is a big system of power there and we must assail it on the political front, the economic front and through social media.”
Mr Katter drew reference to the story of Charlie Phillott (speaking at the summit) who’s story written by David Pascoe, went viral and became the most shared post in Australian History.
“The people of Australia are behind us, but we have got to know clearly what we want,” Mr Katter said.
“We must fight for survival.”
Final Agenda Charters Towers Rural Crisis Summit
Chaired by Shane Knuth and Robbie Katter
9:50 – Take your seats for the morning
10:00- Opening Address and Welcome Shane Knuth MP Member for Dalrymple
10:10- Andrew Jensen chairman Charter Towers Rural Crisis Committee, Committee work and goals for the day/ House keeping
10:15- Charlie Phillott face of the crisis/ Winton
10:20 – Bill Byrne MP, Minister for Agriculture Queensland Government
10.35 – Open Questions to Minister Byrne
10:50 – MORNING TEA
11.30 – Brian Egan, Aussie Helpers
11.40 – Cate Stuart, Formerly of Mount Morris Station
12:00 – Ben Rees, Australian Agriculture, the Real Story 12:15 – Dr Mark McGovern, Summing Up
12:45 – Committee Resolutions/ Other resolutions
1:30 – Bob Katter Federal Member of Kennedy, Closing address
For more information on the day please call: 0466-7 11-527
Please join this campaign to stop the banks from stripping our personal assets including our homes!
The Commonwealth Bank of Australia has announced the highest ever financial heist by any bank in the country of $8.6 billion, to the end of June 2014.
Today the ANZ Bank announced a nine month profit of $5 billion.
All of this without ever lending one cent in legal tender of their deposits.
While Queensland wallows in a sea of debt owed to foreign bankers thanks to the former Labor Government, the State Treasurer Tim Nicolls by his inaction, does not understand the basic tenets of the creation of money.
The Commonwealth Bank has in effect taken $8.6 billion out of the national economy, by creating a monetary deposit every time a loan is approved.
When struggling borrowers repay their loans with their wages or business income covering interest and redemption, the bank profits by the entire amount with money it did not originally possess.
The fractional reserve system enables banks to lend at least 18 times the value of their deposits without lending one cent in legal tender (notes and coins).
Has any bank customer ever been told by a teller, “ I am sorry I can’t cover your withdrawal because we lent your deposit to another customer.”
The CBA will pay a dividend of an average $3,500 to every shareholder.
Treasurer Tim Nichols legally can set up a State Bank lending to local authorities and for development projects without borrowing one cent from any bank.
State Banking once was National Party policy.
This bank can issue credit at low interest rates for projects against the collateral value of the mineral and agricultural resources of the State.
Infrastructure funding would be available for large projects such as new railways which are desperately needed to take the pressure off the State’s crumbling road network.
Treasurer Nicholls and his party could easily remain in power if he had the integrity and intestinal fortitude to buck the banks and help desperate farmers and businesses in the State to prosper.
Selling publicly owned assets is unlawful because the corporate ‘Queensland Government’ does not own them.