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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.
Australia’s expensive real estate problem remains a dirty little secret DomainJul 16, 2018 Iain Gillespie   Nobody knows how many billions of dollars in dirty money is pouring into Australia’s housing market, but global authorities describe local real estate as a prime target for money laundering – and you may have paid more for your house because of it. The likelihood of cashed up crooks increasing house prices is much greater than many people realise, given the hidden nature of the problem, a lack of regulation in the Australian real estate industry and the staggering sums involved. AMP chief economist Shane Oliver says criminals willing to pay extra to wash illicit funds have probably already had an impact on the high end of the housing market. “Even one transaction can have a huge effect that pulls the whole lot up.” Real estate agents say corrupt money can also influence average house...
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ANZ backs moratorium on drought-stricken farmers, admits to misconduct Sydney Morning Herald 17 July 2018 5:04pm Clancy Yeates & Sarah Danckert   ANZ Bank has backed a moratorium on the repossession of drought-stricken farms and, along with the Commonwealth Bank, admitted to "misconduct" in their treatment of some rural customers. The banks were responding to criticism this month by the banking royal commission's top lawyer over their overly tough treatment of farmers. Senior counsel assisting the commission, Rowena Orr, this month delivered "open findings" that could be made by commissioner Kenneth Hayne of poor treatment of farmers by ANZ, CBA, National Australia Bank, Bendigo and Adelaide Bank, and Rabobank. In submissions released on Tuesday, ANZ admitted to several cases of misconduct towards customers it acquired when it bought agricultural lender Landmark in 2010. But it argued that most of the case studies presented by Ms Orr showed behaviour that fell below...
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Young borrowers at risk: RBA The Australian 12:00am July 18, 2018 David Rogers, Samantha Bailey   The Reserve Bank has singled out younger households with lower incomes, less stable employment and smaller savings buffers as a risk to the economic outlook in the event of any shocks. In the minutes of its July board meeting, the RBA said that after a detailed discussion of Australia’s high household debt — informed by a “special paper” prepared for the meeting — “household balance sheets continued to warrant close and careful monitoring” amid increasing risks to the global economic outlook from rising US-China trade tensions. The comments come as borrowers are starting to feel the pinch from a round of out-of-cycle interest rate hikes on variable mortgages by regional lenders and credit unions in recent weeks, blaming higher funding costs. Borrowers with a mortgage of $1 million are on average paying an additional $715...
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Property scam snares self-managed super funds The Australian 6:56am July 18, 2018 Robert Gottliebsen   Lurking behind the decision by Westpac and other big banks to stop lending to self-managed superannuation funds is a property racket that threatens significant losses to those who were caught. It is highly likely that some banks will be caught up in it but I strongly emphasise that I have no knowledge of which banks may have been ensnared and just because Westpac has withdrawn from the property lending superannuation market does not mean they have been caught. But many of those self-managed super funds who were caught are already down around 20 per cent and we have a big “blame game” ahead of us. Before detailing how the racket worked, I want to background the situation. The self-managed fund movement really boosted the quality and depth of our superannuation movement at a time when too...
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ASIC's Peter Kell says advice firms start dobbing in 'bad eggs' Australian Financial Review Jul 17 2018 5:06 PM James Thomson   Deputy chairman of the Australian Securities and Investments Commission, Peter Kell, says financial advice firms are finally starting to dob in dodgy advisers and tell the regulator when they move firms. The royal commission has probed the propensity for advisers with poor records to simply shift to another firm, and ASIC has created a register of financial advisers to help the industry and consumers track adviser movements. Mr Kell said on Tuesday that after many years of sweeping the records of their poor advisers under the carpet, the under-fire wealth industry is starting to share more information. "We are getting more financial advice firms coming to us and reporting bad apples," Mr Kell said on the sidelines of a business event in Melbourne. "That was always a source of...
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CBA farm account bungle puts risk back in the spotlight Australian Financial Review Jul 16 2018 8:09 PM James Frost   Systems that allowed thousands of Commonwealth Bank customers to be overcharged by almost $8 million have been described as inadequate and in breach of the law in a development that has thrust the bank's risk department back into the spotlight. The frank assessment of CBA's systems in relation to its overcharging of farming finance customers was made by the Hayne royal commission's senior counsel Rowena Orr, QC, in open findings published quietly in a standalone document 10 days ago. Under a subheading of "Inadequacy of internal systems", Ms Orr said it was open to the commissioner to find two examples of misconduct from the case study including a breach of the Corporations Act that could be attributed in part to CBA's sloppy "control environment". "The errors were not prevented or...
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Superannuation’s decade of failure exposed The Australian 12:00am July 17, 2018 Anthony Klan   Five million superannuation accounts holding $260 billion and managed by the Big Four banks and financial services companies AMP and IOOF have delivered average annual returns less than the risk-free “cash” rate over the past decade and many have performed below the rate of inflation. Audited performance data provided to the Australian Prudential Regulation Authority by Westpac, NAB, CBA, ANZ, AMP and IOOF shows the biggest super fund operated by each of those institutions delivered total average annual returns to members of 2.1 per cent to 3.1 per cent over the decade to June 30 last year. At the same time, the average annual rate of return on risk-free “cash” investments was 3.8 per cent, meaning the owners of those five million super accounts would have been better off had the money been placed in low-interest term...
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SMSF property lending is drying up as Westpac pledges to stop lending The New Daily 10:00pm, Jul 16, 2018 Rod Myer   Westpac has slammed the door on self-managed super funds, pledging to stop lending to them at the end of July. That effectively cuts off the supply of funds for SMSF property deals from the big banks. It is a move that will dampen an already weak investment property market and comes after the ALP has pledged to outlaw SMSF borrowing if elected. In a statement on Monday, Westpac said it would be “withdrawing from sale our SMSF Home Loan product and Business Lending to SMSFs, effective Tuesday 31 July 2018″. But it will continue to service existing customers. As the biggest lender to the area among the big four, the move is a body blow to SMSF borrowing. “As far as we are aware, Westpac is the only major...
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Banks face cash squeeze as fund managers, households draw deposits Australian Financial ReviewJul 15 2018 11:09 PM Jonathan Shapiro   Australia's banks will be forced to find an additional $70 billion of funding as superannuation funds shift out of cash into international assets while indebted households draw down on their savings. The widening of the so-called "funding gap", which measures the difference between bank loans and deposits, comes amid a crisis-like blowout in short-term funding that is increasing bank funding costs and has already prompted the non-major banks to enact "out-of-cycle" mortgage rate rises. The gap between loan and deposit growth has increased from $390 billion in the second quarter of 2017 to $457 billion in the first quarter of 2018, resulting in an additional funding bank requirement of $60 billion to $70 billion, according to analysis by National Australia Bank economists. The rising financing demands may further increase funding cost...
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How ASIC closed in on AMP’s ‘orphan’ customers The Australian 12:00am July 16, 2018 Pamela Williams   The key document that sparked AMP to commission Clayton Utz last year to investigate its “fees for no service” scandal was already in the sights of the corporate regulator before the consultancy’s ­report was ever completed and handed to the AMP board. This explosive AMP internal document, which became known at the corporate regulator as the “orphan contracts document”, five years ago canvassed the ­severe risks for AMP if it did not cease charging fees on so-called “orphan policies” where clients had no financial adviser. The Australian Securities & Investments Commission was sharply tightening its focus on AMP last year with demands for historic paperwork after several years of investigating AMP and big banks over fees for no service. The formal demand from ASIC for all records relating to the orphan contracts document was...
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APRA’s shield of secrecy exposed The Australian 12:00am July 16, 2018 Anthony Klan   The regulator for the nation’s entire $2.6 trillion superannuation industry has for many years misled the public by falsely claiming it is unable to comment regarding its policing of the nation’s biggest super funds. Representatives for the Australian Prudential Regulation Authority have, for almost two decades, claimed they were unable to comment on individual super fund managers under the “secrecy” provisions of the 1998 APRA Act. “APRA does not comment on its discussions or actions with respect to individual financial entities, even on background, as it would be a breach of Section 56 of the Australian Prudential Regulation Authority Act 1998,” spokesman Ben McLean said. That statement was in response to one of many recent unsuccessful requests the newspaper has made seeking an interview with APRA chairman Wayne Byres. This newspaper has for the past four months...
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Banks slow to meet loan rules The Australian 12:00am July 16, 2018 Michael Roddan   Australian banks have been dragging their feet in meeting new rules on home lending, despite regulatory appeals to wean the industry off riskier loans. The Australian understands no major bank has yet been given the green light to grow their property investor lending book above 10 per cent, despite the regulator declaring the removal of the cap in April. The Australian Prudential Regulation Authority had imposed the cap on lending in late 2014 as part of a package of measures to cool the $1.7 trillion mortgage market. However, in April APRA said it would allow banks to again bypass the lending limit on property investors if they could prove to the regulator they were targeting lower-risk borrowers. To do this banks were required to put limits on lending to borrowers with high debt-to-income ratios as well...
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National Archives spends up in fight over John Kerr’s letters to Queen The Australian 12:00am July 14, 2018 Primrose Riordan   The National Archives, which has recently lost staff due to budget cuts, has spent nearly $1 million fighting the release of information including John Kerr’s letters to Buckingham Palace and documents on Australian spying in East Timor. The agency released the figures this week in response to a question on notice from Centre Alliance senator Rex Patrick, who is set to push for changes to freedom-of-information laws via a private member’s bill in the next sittings of parliament. The agency said it had spent $926,474.89 from the 2015-16 ­financial year until May 31 this year fighting the release of records and information. Historian Jenny Hocking took the archives to court arguing the government should publicly ­release Kerr’s letters to Buckingham Palace during the constitutional crisis that led to Gough Whitlam’s...
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The Australian 12:00am July 14, 2018 Rick Morton   A long-time Liberal staffer in the Howard government, who ran for preselection for a Victorian state seat, has been ­appointed by Scott Morrison to head the influential Productivity Commission, the second crucial economic selection in as many days. Michael Brennan, who served as chief of staff to South Australian senator Nick Minchin when he was finance minister, was hand-selected by the outgoing head of Treasury John Fraser. Mr Fraser resigned on Thursday and will be replaced by Philip Gaetjens, the former chief of staff to treasurer Peter Costello and more recently the Treasurer. To complete the ascension of Liberal staffers, Mr Brennan’s old role as a deputy secretary in the Treasury fiscal group will be taken by Finance Minister Mathias Cormann’s chief of staff Simon Atkinson. “Let’s get this right, Scott Morrison’s former chief of staff and Mathias Cormann’s former chief of...
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Super funds ‘skimming over $700bn in fees’ The Australian 12:00am July 13, 2018 Adam Creighton   For two decades the superannuation industry has extracted more than $700 billion in fees above what typical super funds charge overseas, equivalent to almost 40 per cent of the nation’s annual GDP, ­according to new analysis. Super funds charged fees more than four times higher than similar funds in Canada, Europe and the US, with workers thousands of dollars worse off each year, the study says. “If members’ contributions between 1997 and 2016 had been invested in a passively managed fund with typical expenses and allocations, they would now be valued between $700bn and $800bn larger,” University of NSW economist Nicholas Morris said. The total pool of superannuation assets, $2.6 trillion in March, would now be more than $3.3 trillion. Declaring superannuation a “policy failure”, Professor Morris, a joint founder of the highly regarded Institute...
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Buyer beware: The high cost of Hobart’s property price bubble The New Daily10:00pm, Jul 12, 2018 Isabelle Lane   Mainlanders considering Tasmania as a cheaper alternative to their home cities have been warned to tread carefully, as the state grapples with a lack of affordable housing. Hobart’s rental and home prices have risen rapidly over the past year, with a growing number of Tasmanians unable to find affordable homes in the state’s capital. As Sydney’s property price boom comes to an end, with home values falling 4.5 per cent over the past financial year, Hobart’s housing market — one of the nation’s smallest — has heated up. Home prices in Hobart increased by 12.7 per cent over the 12 months to June, according to CoreLogic, while rents rose 10.7 per cent, the highest annual increase of all capital cities. Buyer beware Hobart’s housing price boom and growing affordability crisis have created...
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Residential property sentiment in free fall warns Morgan Stanley Australian Financial Review Jul 12 2018 3:30 PM Duncan Hughes   Prospects for the nation's residential property market have slumped to record lows with no trough in sight, according to global financial conglomerate Morgan Stanley. The investment bank, which recently claimed prospects for growth are the worst in 30 years, warns credit continues to tighten, sentiment is slipping and additional stock is hitting the market, pushing rental inflation below 1 per cent. It is warning "at this stage" that prices could slump by another 10 per cent as all six key indicators in its housing model - ranging from demand/supply balance to credit supply and house price expectations - turn negative. Regulatory, credit, economic and supply issues are combining to tighten supply and weaken demand after six years of growth and booming prices in major cities, particularly in Sydney where prices have...
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  It “Hit the Mortgage Market Over the Head with a Baseball Bat” Wolf StreetJul 11, 2018 Wolf Richter   8 boots-on-the-ground findings about Sydney’s deflating housing bubble. Australia’s housing market is getting rattled. The mortgage industry is in turmoil. Banks are battered by incessant revelations of misconduct.  Home prices in the Sydney and Melbourne metros, after surging to an astounding degree, are deflating. And the once splendid and vast game of real-estate speculation just isn’t fun anymore. Lindsay David, of LF Economics in Sydney — who has long played a role in exposing misconduct in Australia’s banking system including, in early 2016, by calling for a Royal Commission investigation into the mortgage sector — put some findings of his boots-on-the-ground analysis into a note to clients. Here are some of them: 1. Drop-off in Speculative Demand: “We spent countless hours” in recent months “observing buyer turnouts to scheduled property inspections...
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APRA stress test draws fire on detail The Australian 12:00am July 13, 2018 Michael Roddan   The banking regulator’s stress test of the Australian financial system has come under fire after financial economists criticised the regulator for its lack of detail and its overly optimistic assessment of the health of the $1.7 trillion mortgage market. Unveiling the results of the latest stress test of the industry, Australian Prudential Regulation Authority chairman Wayne Byres said on Wednesday the era of large-scale overhauls of lending standards and restrictions was drawing to a close as the “heavy lifting” had “largely been done”. Mr Byres said APRA’s stress test showed the banking sector would remain above the capital requirement buffer throughout an economic crisis modelled on a plausible scenario where the Chinese economy imploded, causing Australian GDP to fall 4 per cent, the local jobless rate to spike to 11 per cent and house prices...
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APRA’s Wayne Byres gives lenders a clean chit The Australian 12:00am July 12, 2018 Michael Roddan   The banking regulator has declared “mission accomplished” on shoring up standards in the scandal-ridden home loan sector, and dismissed concerns of a ticking debt bomb of liar loans and fears of rising interest-only mortgage stress. Australian Prudential Regulation Authority chairman Wayne Byres said yesterday that the era of large-scale overhauls of lending standards and lending restrictions were drawing to a close, as the “heavy lifting” had “largely been done”. Mr Byres also gave the $1.7 trillion mortgage system a clean bill of health following his latest “stress test” of the industry. His speech at an economists lunch in Sydney left APRA accused of being “captured” by the industry it regulates at a time when the royal commission is unearthing reams of evidence of misconduct. The remarks that there would be no new major restrictions...
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NAB shrugs off concerns, keen on mortgage broking Australian Financial Review Jul 11 2018 8:30 PM Joyce Moullakis   National Australia Bank is committed to retaining ownership of its mortgage broking units, despite increased controversy and regulatory scrutiny around commission payments, according to sources. The Australian Financial Review understands that while NAB's ownership of broker groups has been a talking point internally in recent months, the bank is – for now – comfortable with holding onto them. The bank's businesses include white labelling arm Advantedge, and aggregators FAST, Choice and PLAN Australia.  A NAB spokesperson declined to comment on the bank's position, pointing only to chief executive Andrew Thorburn's separate announcement in May about the divestment of MLC, including advice, platform, superannuation and asset management businesses. At the same time, NAB said it would retain JBWere and its nabtrade online trading platform. NAB's interim results showed a reliance, like many of...
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Brisbane has 10,000 more apartments in pipeline than it should: RiskWise Australian Financial Review Jul 11 2018 11:45 PM Matthew Cranston   Brisbane's inner-city apartment market has about 10,000 more homes in the pipeline than it should, says property research outfit RiskWise, and the city is expected to face more defaults on settlement. RiskWise chief executive Doron Peleg said developers and lenders were "failing to properly assess the risks" when it came to supply and demand, and the inner-city Brisbane apartment market was a prime example. "What we are seeing now is the realisation of the risk that should have been identified at least a couple of years ago. Defaults have been rising and will continue to do so," he said. RiskWise argues that, as early as June 2016 in the Statistical Area Level 4 of Brisbane inner city, price growth was -1.8 per cent with 17,417 units in the pipeline...
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CBA accepts enforceable undertaking over BBSW conduct Australian Financial Review Jul 11 2018 10:49 AM Jonathan Shapiro   The Commonwealth Bank will pay a total of $25 million in fines, penalties and community benefits after formally accepting an enforceable undertaking with the corporate regulator in relation to its role in setting the bank bill swap rate, a key market benchmark used to price hundreds of billions of loans and securities. The Australian Securities and Investment Commission announced that the bank had accepted the undertaking, as its multi year pursuit of the big four banks' over their role in setting the BBSW draws to a close.  As part of the undertaking, CBA will pay $15 million to be "applied to the benefit of the community" and $5 million towards ASICs investigation and legal costs. The bank will also engage an independent expert to assess changes made to its policies, systems and supervision...
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Property powder keg threatens banks The Australian 11:46am July 11, 2018 Robert Gottliebsen   Bank shares have been rising again as the market believes that their directors are right on the issues of problem loans and that global investment house UBS is wrong in stating that deep issues loom. No one really knows — certainly not me — whether the banks or UBS are right but the issue is now taking on greater significance because liability insurers are becoming reluctant to insure banks and particularly their directors over claims that might arise. In addition, if UBS are right about the level of problem bank loans, it looks like many of those loans could have been extended as a result of irresponsible lending and therefore the banks will be liable for big losses. While this high stakes debate continues, across my desk came a detailed survey undertaken by the Digital Finance Analytics...
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APRA's Wayne Byres says there is no evidence of a mortgage credit crunch Australian Financial Review Jul 11 2018 1:00 PM Jonathan Shapiro   A multi-year crackdown on home loan lending standards does not appear to be hurting credit growth, and by extension the economy, according to the chair of the prudential regulator who revealed the banks could withstand the double impact of a dramatic economic shock and a misconduct scandal. Australian Prudential Regulatory Authority chair Wayne Byres said it's "difficult to tell" whether the regulator's actions to improve lending standards at the banks was impacting the flow of credit, but he said "the changes in lending practices to date do not seem to have had an obvious impact on housing credit flows in aggregate." "Total housing lending grew at around 6 per cent in the year to May 2018, which is only marginally below long-run averages and roughly in line...
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