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BFCSA
MORTGAGE
DISTRESS SOS

What BFCSA Does...

BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.

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Denise Brailey

Led by award-winning consumer advocate Denise Brailey, BFCSA (Inc) are a group of people who are concerned about the appalling growth of Loan Fraud around the world. BFCSA (Inc) is a not for profit organisation in the spirit of global community concern and justice.

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Denise

Denise

Denise Brailey has dedicated the past 20 years of her life to being a Consumer Advocate - a voice for the people and former President of RECA (Real Estate Consumer Association. She has helped thousands of investors and is currently President of the BFCSA (Banking & Finance Consumers Support Association). Denise was also awarded and presented with the Rona Oakley Award for Consumer Protection in 2010.
Banking royal commission: NAB put on criminal charge alert The Australian 12:00am August 9, 2018 Ben Butler, Michael Roddan   National Australia Bank may face criminal charges over a probe by the corporate regulator into the company’s “suspected offending”, amid revelations the lender charged fees of more than $3 million to dead people. Financial services royal commissioner Kenneth Hayne also raised the prospect that NAB’s taking of money “to which there was no entitlement” for services it never provided might be a crim­inal offence during an at-times torrid day of hearings yesterday. The proceedings also laid bare NAB’s unsuccessful attempts to convince the Australian Securities & Investments Commission that it should not have to pay full compensation to customers slugged with fees for which they received no service, and revealed the slow pace at which it moved other clients out of old high-fee funds into a cheaper ­option, as ­required by...
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First competition regulator chief backs Green bid to break banks The Australian 12:00am August 9, 2018 Adam Creighton   The inaugural head of the competition regulator, Allan Fels, has called for a radical overhaul of bank regulation and structure, backing the Greens’ push to break up the major banks and AMP to curb gouging of customers and hidden subsidies to investment banks. Revealing his “astonishment” at the revelations at the royal commission, Professor Fels, who chaired the ­Australian Competition & Consumer Commission from its inception in 1995 to 2003, said “deep structural conflicts of interest” would overwhelm piecemeal ­efforts to curb unethical behaviour. “There are inherent conflicts and it should be obvious they won’t be resolved by better behaviour by banks or better management by regulators,” he said. “I’ve been surprised, astonished, at the extent of unethical behaviour and it indicates to me banks can’t be trusted to deal with these...
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Banking royal commission: Richard Di Natale calls for bank execs who commit crimes to face jail The Australian 2:29pm August 8, 2018 Michael Roddan   Greens leader Richard Di Natale has called for “lengthy criminal sentences” for banking executives who commit crimes and slammed the conflicts of interests that reward bankers for charging fees to customers where no service has been provided. Speaking outside the Federal Court in Melbourne, where the royal commission is grilling National Australia Bank executives who charged millions in fees to superannuation customers in return for little or no benefit, Mr Di Natale said there was “a cancer at the heart” of the banking and financial services sector.  “The foundations are completely rotten,” Mr Di Natale said. The press conference came just moments after royal commissioner Kenneth Hayne raised the prospect that National Australia Bank may have committed a crime by taking money from superannuation customers to...
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ASIC funding boost to put 'supervisors' in big banks, AMP Australian Financial Review Aug 7 2018 12:18 AM James Eyers   ASIC staff members will be embedded inside the major banks and AMP to supervise governance and compliance under a new, proactive approach to enforcement being implemented by its chairman James Shipton, which the government has backed with $70.1 million in additional funding. After the Australian Securities and Investment Commission's funding was reduced by $26 million in this year's federal budget, the government will announce more money for the corporate regulator on Tuesday, including $8 million over the next two years so it can adopt a "new supervisory approach" that will see dedicated staff assigned to monitor the five financial institutions. The more aggressive approach comes after Treasurer Scott Morrison said on Friday the concept of putting a "principal integrity officer", with a positive duty to report misconduct to regulators like...
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Hayne royal commission: NAB had 'commercial concerns' about ending commissions Australian Financial Review Aug 6 2018 6:51 PM Joanna Mather   National Australia Bank devised a strategy to continue charging the types of commissions banned under the Future of  Financial Advice laws, the banking royal commission heard. In July 2016, five NAB super funds were merged into one to create the MLC Super Fund. Earlier, NAB executives sought ways to transfer customers to the new arrangements without relinquishing the capacity to charge "grandfathered" commissions. Former executive Paul Carter agreed there were "commercial concerns" in relation to revenue. But he insisted NAB was also worried about angering financial advisers, who might withdraw their clients. The fund's assets would be depleted, which could in turn leave members worse off, Mr Carter said. Counsel assisting Michael Hodge was unconvinced. He asked whether the bank might have been more concerned about fee revenue than clients....
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Banking royal commission: super rip-offs, gouging revealed The Australian 12:00am August 7, 2018 Ben Butler, Elizabeth Redman, Michael Roddan   Australians are being ripped off by super fund trustees “surrounded by temptation” to do the wrong thing with the $2.6 trillion retirement savings pile, while regulators are failing to search out and punish bad behaviour, the banks royal commission has heard. In one example of fee gouging outlined at the royal commission yesterday, NAB charged a customer of its MLC division an array of fees that gobbled up $892.20 of $1101.95 earned from a year-long investment in the simplest option available, cash. As the commission investigates the inner workings of the compulsory superannuation system over the next two weeks of hearings, it will explore how retirement savers are swindled through fees for services they never receive, cosy deals between retail super funds and the banks that control them, account-draining insurance premiums,...
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APRA needs to be held to account on superannuation fund performance Australian Financial Review Aug 5 2018 11:00 PM Adele Ferguson   A multibillion-dollar Commonwealth superannuation fund whose 137,350 members include public servants, defence personnel, SES officers and some former politicians, has been labelled a rip-off, opaque and not acting in members' best interests. Former Labor politician Mark Bishop, who chaired a landmark Senate inquiry into Commonwealth Bank that called for a royal commission back in 2014, said the fund makes the banks look like angels. Since he joined the $12.5 billion Public Sector Superannuation Accumulation Plan(PSSAP) last September he was put into a default insurance scheme he didn't know he was in – and didn't need - which has been deducting a whopping $774 a fortnight in income protection premiums. In July 2018 he checked his account balance (not for the full year) and noted it was $9000 less than...
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Super industry veteran slams Westpac’s ‘amazing deception’ The Australian 12:00am August 6, 2018 Anthony Klan   The founder of one of the nation’s biggest superannuation platforms has described Westpac’s moves to slash its fees for new members for its BT Panorama product as an “amazing deception” that does little to nothing to help members of the public who sign up. Super industry veteran Bruce Tustin, founder of Oasis Asset Management and its chief executive until the group was taken over by ANZ, said the moves by Westpac’s BT were a “myth” and it had “simply hidden the highest of the fees in the fine print”. “Even in light of the royal commission seeking greater transparency, Westpac’s BT have come out with the most amazing deception I have seen and advertised it on many full page ads in the (Australian) Financial Review,” he said. BT’s announcement two weeks ago, he said, “on...
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Self-regulation is code for bank misbehaviour The Australian 12:00am August 4, 2018 Alan Kohler   The first rule of self-regulation via a code of conduct is that those who need it will ignore it, and those who read and follow it didn’t need it. Rule No 2 is that the purpose of self-regulation is to stop regulation by someone else, not actually to regulate. The self-regulation under discussion is the Australian Banking Association’s 25-year-old Code of Banking Practice, which must go down as one of the great triumphs of the genre in history. It’s not too often an industry that’s subject to a strict and longstanding moral code cops a royal commission, and one that so quickly turns out to be so well-deserved. The 2019 banking code of practice, released this week, updates a succession of codes that began in 1993, with the benefit of an independent review by Phil Khoury...
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PM Malcolm Turnbull backs plans for integrity officers The Australian 12:02am August 4, 2018 Michael Roddan   Malcolm Turnbull has thrown his weight behind a proposal to ­expand laws requiring Australia’s biggest banks to sell products only in their customers’ best interests, under the threat of regulatory action if employees breach their duty. The plan to install an “integrity officer” at all lenders, who could report to the corporate watchdog if bank boards ignored pleas to overhaul remuneration in conflict with good customer outcomes, was one of many ­recommendations in a scathing Productivity Commission review of competition in the financial system. The review criticised the banks for pushing onto customers a “blizzard of barely differentiated” and overly ­expensive products to ramp up profits. Releasing the report yesterday, Scott Morrison savaged the big banks for punishing loyalty and keeping customers “in the dark”. The Treasurer said customers who stayed with the same...
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Malcolm Turnbull defends surprise $444 million Government donation to tiny reef body ABC News4 August 2018 Louise Yaxley   Malcolm Turnbull insists the Government's nearly half-a-billion-dollar donation to a private foundation with links to big resources companies has been done transparently, despite the body itself not asking for the money. In April the Government announced it would give the Great Barrier Reef Foundation $444 million to fund projects to improve the health of the reef. The foundation had only six staff when it was told it was getting the huge grant, which managing director Anna Marsden told Radio National was an "absolute surprise". The $444m donation is the largest Government donation to a private foundation in Australian history, and Federal Labor is demanding an explanation of why no tenders were called. Mr Turnbull defended the decision on Friday, calling it the "single biggest contribution and investment in the health of the...
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Moody’s warns of default spike as interest-only loans mature The Australian 12:00am August 3, 2018 Richard Gluyas   Moody’s has warned that Australian mortgage delinquencies will rise over the next two years as a record number of interest-only loans convert to principal-and-­interest payments. This would reduce the creditworthiness of residential mortgage-backed securities. “Refinancing of interest-only mortgages is also becoming more difficult, which will contribute to an increase in mortgage delinquencies,” the credit-rating agency said. The forecast blowout in delinquencies relies on Moody’s data that shows loans converting to principal-and-interest repayments after an interest-only period had a 90-days-past-due delinquency rate of 0.94 per cent in November last year — double the rate for interest-only loans yet to convert. The rate was 24 basis points higher than the overall ­delinquency rate for securitised mortgages. When interest-only loans convert to principal and interest, typically after a period of five years, borrowers often experience a...
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Treasurer Scott Morrison lashes the banks, regulators on competition Australian Financial ReviewAug 2 2018 11:00 PM James Eyers   EXCLUSIVE  Treasurer Scott Morrison will deliver a harsh reprimand to the banks and regulators today, chastising lenders for exploiting customers' loyalty, which he says is costing each up to $87 a month. As the banks promote their new code of conduct to protect consumers, the government will release on Friday the Productivity Commission's final report into competition in the Australian financial system, which has found banks have sustained prices above competitive levels, offered customers inferior quality products, subsumed much of the broker industry and stopped competitors expanding in some markets. "All are indicators of the use of market power to the detriment of customers," the report says. The commission's recommendation for banks to create an "integrity officer" to monitor mortgage brokers is "an interesting idea" that could have broader application, Mr Morrison...
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Super: the $1m difference between retail and industry funds The Australian3:01pm August 2, 2018 Anthony Klan   The $2.6 trillion super industry has on average delivered poor returns over the past two decades due to the underperformance of super funds run by the Big Four banks and major financial institutions, costing the nation more than $12 billion a year, according to an expert submission to the Productivity Commission. The detailed report by analyst Wilson Sy, formerly a principal researcher with the Australian Prudential Regulation Authority, says the poor performance is “largely attributed” to for-profit retail funds, which have delivered returns well below market rates. According to the report, filed with the Productivity Commission on July 23, retail funds delivered an average return of 4.6 per cent a year, compared to an average 6.7 per cent for “industry” or not-for-profit funds.  “At March 2017, retail sector assets were $577bn; if the retail...
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David Murray's defiant plan for AMP Australian Financial Review Jul 31 2018 11:00 PM Tony Boyd   EXCLUSIVE  AMP chairman David Murray says he will push back hard against the ASX corporate governance principles and restore the primacy of the chief executive at the troubled wealth manager, to make the board and management more clearly accountable for their actions. "I think the board's got to conduct itself in a way that it looks to the CEO for everything," he said. In his first in-depth interview since replacing Catherine Brenner as chairman of AMPin June, Mr Murray said he would strengthen internal control systems, give increased power to AMP's internal auditors and put more distance between management and non-executive directors. Mr Murray said the ASX governance principles had led to directors being swamped by hundreds of pages of board papers and not having enough time to debate important strategic issues, which he...
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Treasury not worried about vertical integration. Not a problem The Adviser 31 July 2018 Tas Bindi   The Australian Department of Treasury has told the financial services royal commission that there is a lack of evidence showing that consumers are being harmed by vertical integration. In a background paper to the financial services royal commission, the Department of Treasury agreed with a recommendation made through antecedent inquiries, such as the Financial System Inquiry and ASIC's review of broker remuneration, that lender-owned aggregators and brokerages should be transparent about their ownership to customers. However, Treasury believes that while there are "risks" with vertically-integrated models, there is limited evidence to show that consumers are being harmed by vertical integration. Touching on ASIC’s findings that lenders’ shares of the flow of vertically-aligned aggregators were “substantially higher than their overall share of brokered home loans” when there was also a white label arrangement in place,...
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Credit crunch could hit house prices by 20pc: Endeavour Australian Financial Review Aug 2 2018 12:03 AM Jonathan Shapiro   Sydney and Melbourne house prices could fall by 15 to 20 per cent in a repeat of the late 1980s and '90s, an independent equity research firm has argued, citing the "largest regulatory credit crunch in 30 years" as the cause for the slide in property values. Endeavour Equity Strategy said in a detailed 30-page report that more evidence had emerged to support its claims that about 40 per cent of all mortgages were "non-prime", based on the level of borrower's income relative to debts, as it called on the prudential regulator to force the banks to increase their disclosures of mortgage risk. A crackdown on the use of measures that understated borrower expenses, and overstated their borrowing capacity, would reduce loan values by up to 30 per cent and have...
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A Housing Bubble Pops: Update on Australia Wolf StreetAug 1, 2018 Wolf Richter   In Sydney, Australia’s largest housing market and one of the world’s biggest housing bubbles, prices of homes of all types fell 5.4% in July compared to a year ago, and 5.5% from the peak in September. Prices of single-family houses dropped 7.0%, and prices of condos (“units”) fell 1.6%, according to CoreLogic’s Daily Home Value Index: The most expensive quarter of the market got hit the hardest, with prices down 8.0% in July compared to a year ago. Across the so-called “most affordable quarter of the market” – “least unaffordable” would be more appropriate – prices fell by 1.8%. And supply in Sydney is starting to come out of the woodwork: Total number of homes listed for sale in July, at 26,103, was 22% higher than a year earlier, and according to CoreLogic, the most since July...
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New quality of financial advice rating system to probe licensee governance Australian Financial Review Jul 31 2018 6:21 AM Alice Uribe   EXCLUSIVE   A federal government-backed body has thrown its weight behind a plan for a national financial advice rating system for planning firms, as the sector attempts to reverse the destruction of trust brought about by a raft of bruising royal commission revelations. Consumer group Adviser Ratings on Tuesday unveiled a proposal for a "quality of financial advice rating system" which would rank more than 1800 financial advice licensees using metrics such as quality of internal governance, and whether its authorised representatives have ever been banned. "The focal point of our methodology is to predict actions within a licensee that are detrimental to clients' interests. Chief among these are instances of misconduct," said an accompanying white paper co-authored by Adviser Ratings' chief executive Mark Hoven and Jerry Parwada, professor of...
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Housing stress in Sydney hits a new high Sydney Morning Herald 30 July 2018 11:01pm Matt Wade   Sydney’s long property boom has left one in eight low and middle-income earners across the city in housing stress, the highest proportion in Australia. The latest Household, Income and Labour Dynamics in Australia (HILDA) survey shows the rate of housing stress in Sydney was 10.1 per cent between 2001 and 2004 but reached an all-time high of 13 per cent between 2013 and 2016. The respected study has also revealed a sharp decline in the share of those aged under-45 making the mover to home ownership suggesting the transition from renter to homeowner has become much more difficult. People living in flats have the highest rate of housing stress followed by people living in semi-detached houses. Those living in detached houses have the lowest rates of housing stress. The report found growth in...
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Minnows clear path for Big Four mortgage rate hikes: Moody’s Investors Service The Australian 11:08am July 30, 2018 Cliona O’Dowd   Higher funding costs that have forced smaller banks to raise home loan rates will make it easier for the majors to follow suit, according to ratings agency Moody’s Investors Service. The action by the smaller lenders also shows they are holding on to their pricing power despite the challenges confronting the big banks, Moody’s said in a new report released today. “The smaller banks have been prompted to action because of higher wholesale funding costs and slower loan growth, but the Big Four — which have traditionally led on rate changes — have so far held back, possibly because of political scrutiny against the backdrop of Australia’s ongoing royal commission into financial services,” Moody’s analyst Tanya Tang said.  “The action of the smaller banks could make it easier for the...
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Malcolm Turnbull under pressure to dump company tax cuts Australian Financial Review Jul 29 2018 9:36 PM Phillip Coorey   Malcolm Turnbull faces pressure to dump his company tax cuts after a poor showing in Saturday's byelections stoked concerns in his party that he will struggle to win seats in the clutch state of Queensland at the federal election. By contrast, Opposition Leader Bill Shorten, who faced a possible challenge had Labor failed to hold its seats in the byelections, has cemented his position after Labor retained the key Queensland seat of Longman with an increased margin, held Braddon in Tasmania, and cruised to victory over the Greens in Western Australia to retain the seats of Perth and Fremantle. The Liberals failed in their bid to take back the South Australia seat of Mayo where incumbent Rebekha Sharkie crushed Georgina Downer. Mr Turnbull played down the Longman result, noting it was...
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ASIC chases an alleged international scam linked to FBI probe Sydney Morning Herald 30 July 2018 12:00am Sarah Danckert   The corporate regulator is attempting to shut down an investment scheme that has allegedly siphoned off millions of dollars from unsuspecting consumers and has the hallmarks of a major US fraud case and an FBI investigation. Nearly $18 million of investor money held in accounts linked to Australian company AGM Markets has been frozen by the Federal Court as the Australian Securities and Investments Commission (ASIC) picks its way through a complex web of companies behind local online investing website operators OT Markets and Ozifin. ASIC was granted the freezing orders after alleging AGM Markets, OT Markets and Ozifin, deployed high pressure sales techniques including luring investors to deposit tens of thousands of dollars on the promise of bonus payments. The tactics are similar to those of Israeli online trading group...
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APRA chastised for inadequate super scrutiny The Australian 12:00am July 30, 2018 Michael Roddan   EXCLUSIVE  The Australian Prudential Regulation Authority’s failure to subject “higher risk” superannuation funds to “more intense supervision” was detailed in a damaging official audit two years ago, which found problems with record keeping, inconsistent supervisory practices and tardy review completions. The “effectiveness of superannuation regulators” is set to be probed by Kenneth Hayne’s royal commission, with APRA due to make its first public appearance at the year-long inquiry in hearings that begin next month. APRA is gearing up for a bruising expedition as it faces intensifying criticism from Treasury, the Productivity Commis­sion, financial experts and consumer groups. A 2016 review of APRA’s regulation of super funds by the Australian National Audit Office found only 4 per cent of proposed actions to be taken against funds were recorded in the regulator’s systems, which “limited” its ability to...
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ASIC's 'coercive' approach commoditising audits Australian Financial ReviewJul 29 2018 5:07 PM Misa Han, Edmund Tadros   The corporate regulator's coercive approach has led audit firms to engage in standard "box-checking", which in turn may decrease overall audit quality. The regulator's shift from a collaborative to a coercive approach may be leading to over-reliance on checklists at the risk of taking into account the individual needs of clients, according to the working paper by University of Melbourne's Carlin Dowling, University of Florida's W. Robert Knechel and Monash University's Robyn Moroney. This then results in the commoditisation of audits, which puts pressure on fees and the level of investment in the audit process. The upshot is a vicious cycle of falling audit quality and negative feedback that is eroding the public's perception of the accounting profession and leading to experienced people leaving the audit profession, according to the research. The findings are...
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