The Banking Royal Commission
“In November last year, after much resistance, the government had a change of heart and finally announced a Royal Commission (RC) into the banking sector (let us put to the side for the moment that the government made this announcement shortly after receiving a request from the big 4 banks to do so).
The RC will extend to the banking, superannuation and financial services industry.
The announcement is a welcomed one, particularly having regard to the final report of the Inquiry into ASIC issued on June 2014 which recommended (amongst other things) a Royal Commission into the CBA be established. The CBA has been embroiled in further scandal since this recommendation, along with some of the other banks (just think of examples like the rate rigging scandal involving NAB and ANZ) - it can be no surprise that the public pressure for a RC continued to build, resulting in the announcement.
Former High Court Judge Kenneth Hayne will lead the RC, which is scheduled to commence in February. Mr Hayne sat on the High Court for the period 2007 – 2015 ay which time his retirement was compulsory upon reaching the age of 70 years. His expertise are considerable, having been the longest serving judge on the bench, who served under three chief justices and participated in more than 400 judgements.
There is a lot to do in 8 months, with the RC’s interim report due in September. The RC has 8 months to hold public hearings to:
Investigate and examine alleged misconduct of banks and financial services entities, with a focus on lending standards;
Consider whether any findings of misconduct ought to be referred for criminal prosecution;
Investigate the use of retirement funds, with an emphasis on the use of such funds for a purpose other than those which are in the best interest of members;
Consider the adequacy and effectiveness of current laws and policies within the financial sector, including legislation, codes of practice and internal reporting systems; and
Make recommendations to improve conduct, and avoid future misconduct.
In my 5 August 2017 blog, I touched on the inquiries and reviews that have taken place within the financial sector since the GFC. The announcement of this RC is a welcomed one - let us hope that the estimated cost of $75 million for the year-long inquiry will be a worthwhile investment delivering much needed outcomes.“
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Tracey Mylecharane - Solicitor
Tracey Mylecharane has more than 12 years experience in legal practice and has been involved in numerous matters with clients who have experienced hardship and difficulty with their banks - this has ranged from simple advice and guidance, to assistance lodging complaints through the ombudsman system, to representing clients in court against banks.