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BFCSA: ASIC SLACK to point of CORRUPTION - Whistleblower re CommBank slam dunks LAX Corp Regulator

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ASIC is so confused by its own LIES it has nowhere to hide and cannot even remember what the TRUTH looked like.  BFCSA Members agree.

CommFP whistleblower blasts lax ASIC

21 March, 2014  1 comments



CommFP whistleblower blasts lax ASIC

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The whistleblower in the Commonwealth Financial Planning (CommFP) case, Jeffrey Morris, has claimed the lax approach of the Australian Securities and Investments Commission (ASIC) allowed former CommFP planner Don Nguyen to defraud clients and permitted other CommFP staffers to attempt to cover for his behaviour. 

In a 39-page statement submitted to the Senate inquiry into the performance of ASIC, Morris outlines the chronology of events but states in the introduction that “all the conduct in the Nguyen/CommFP/Commonwealth Bank Australia (CBA) affair happened on ASIC’s watch”. 

“It was the slack regulatory regime of ASIC that allowed Nguyen to operate as a Financial Planner in the way that he did and encouraged CommFP and in turn CBA, to believe that they could, with impunity, cover up what had occurred and defraud the innocent victims of the compensation to which they were rightfully entitled.” 

Morris also claimed ASIC was “still attempting to conceal the full culpability of CommFP/CBA in this matter”. 

“I submit that, as the ineffective regulator responsible for the industry, ASIC has a fundamental conflict of interest in exposing the full extent of the corruption and dishonesty of such a major institution such as CommFP/CBA; as that would in turn be such a damning indictment of their own incompetence and abysmal failure in supervision that it must in turn have implications for ASIC itself. 

“ASIC has therefore chosen to ignore the full extent of CommFP/CBA’s malfeasance in favour of lauding itself for the easy wins of imposing an Enforceable Undertaking and banning seven crooked planners - all of whom were actually offered up by CommFP/CBA rather than being caught by ASIC.” 

He claimed that ASIC had been propagating the belief that “all was fine with the major players in the advice industry” and that it had to act mainly on the fringes. 

“In reality, I think, ASIC believed everything was fine with the big players because that was what the major players were telling them.  

“That explains to me their incredible reluctance to act on CommFP, their willingness to accept whatever CommFP told them despite evidence to the contrary and finally why they couldn’t publicly slam the full extent of CommFP’s corrupt conduct in this matter: to do so would have exploded the myth and eroded confidence in them as the regulator.” 

Morris also claimed that ASIC did not have the confidence of the whistleblowers who were forced to go the media after anonymous reports to ASIC were ignored for months. 

“We then discussed going to ASIC. It is perhaps the most authentic comment on the regard in which ASIC is held in the financial services industry that one of my fellow whistleblowers, at this stage, said simply 'The only problem with that, mate, is that ASIC is sxxx. They’ll never do anything.’ 

“We all felt strongly that we had to do something and ASIC seemed the only viable option. I said that they could hardly fail to act if we gift wrapped the whole thing and dropped it in their lap. If necessary, we would force ASIC to do their job by going to the press.”

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  • Denise
    Denise Sunday, 23 March 2014

    Denise Brailey • 2 minutes ago
    Posted on Money Management.
    Yes Jeffrey. You and I sat listening to the twaddle and excuses coming from the mouth of Greg Medcraft and 6 other luminaries of ASIC in the 19th Feb Parliamentary hearings. Lots more to come out. None are apologetic for the catastrophic damage caused by regulatory neglect and by the four Major Lenders to consumers.

    Our group of consumer bank victims in bfcsa have many CBA cases and yet Ian Narev and ASIC buddies all on song: "no systemic issues."

    The bank engineered computers to approve such dreadful loans, breaching Banking Code on every document. How much longer can these banks expect ASIC to cover up for their misdeeds?

    I noticed the Chairman did not wish to discuss the SERVICEABILITY CALCULATOR used by the Lenders. I wonder why given the importance for consumers to understand the product processing systems?

    I wonder why Bankers refuse to hand over that copy document which contains specific financial details of the client? Clients are entitled to their copy surely? Its a real eye opener into the murky world of banking.

    ASIC needs to be dismantled and a new Consumer Protection Bureau with serious fraud unit, needs to be in place if we are ever to protect consumers in the future. It is the regulatory misleading information given to Parliament by ASIC that is the most galling aspect of whistleblower evidence and information being disregarded.

    I have lost count of the hours spent and the number of packets of evidence I have handed over to ASIC since 1998. Well done Jeff.

  • Denise
    Denise Sunday, 23 March 2014

    Jeff, you say "“That explains to me their incredible reluctance to act on CommFP, their willingness to accept whatever CommFP told them. NO the truth goes much deeper.

    ASIC knew the Banks were using internal (diff NSR) SERVICE CALCULATORS to further fudge/exaggerate the income figures on Loan Application forms. ASIC mentioned this many times in 2003 and admitted back then systemic issues. This is not about Nguyen or one or two brokers,,,,all LAFs are fudged 100%.

    So all brokers are crooks? No, the Major Banks engineered the service calculators to avoid blame or responsibility, yet had to get the brokers to believe that futuristic incomes were not a bad thing....its was helping people get loans.

    Brokers were not told these were timebomb loans set to implode in 3-5 years. The reason the Bank reported to ASIC was because CommBank KNEW ASIC would help cover it up and then the Bank could say - see we reported it and we have dealt with it internally and the game could play on................................

    The bank was also worried that they could no longer use the service calculator income fudging system which was extremely profitable....but like winning a rigged horse race, making lots of lovely money by deception and then being protected from blame by the regulator.

    ASIC was the PROTECTOR OF dodgy banking practices not protector of consumers - the victims in all of this. You raising the issue of Nguyen and a few others was the tip of the iceberg and an inquiry could have led to the entire $50 billion Low Doc loan scandal being killed off. It was too lucrative for banks to allow regulators to spoil the profits. Yet Medcraft said if choosing between protecting markets (low doc dirty loans market) and choosing consumers - no doubt he would protect consumers. He is lying to Parliament. Thats a jailable offence for all of us.....except for Greggie and his banker mates of course. [email protected]

  • doyla66
    doyla66 Sunday, 23 March 2014

    Morris also claimed ASIC was “still attempting to conceal the full culpability of CommFP/CBA in this matter”. It's one thing to be lax or miss the mark in apprehending the wrong doers, it's a whole other basket of fish to attempt to cover up for a corporation.

    Why would ASIC do this, unless they, as a corporation or individuals in that organisation, had something to gain by doing this? Are ASIC on the CBA payroll? Maybe CBA have been paying ASIC to assist with surveillance or other services, through their contacts? Does anyone know what ASIC could lose by doing anything more than token prosecutions and EUs against CBA? And how about the Storm victims - ASIC assisted in getting them a small portion of compensation for their losses. It looked a lot more like ASIC assisted in achieving a plea bargain for CBA and softening the blow for them.
    No real penalties against the sacred cows of Banking is leading to anarchy amongst white collar crooks and small time crims, to the detriment of investors and borrowers.

    If the Federal Government want to create more crime for some reason, this is the way to do it: keep ASIC and stay soft on crime. Only problem is these trouble makers are a minority and decent people are the majority, so you could lose your seats at the next election unless you step up to the mark and ensure that the Rule of Law applies right across the population - including Banks!

  • doyla66
    doyla66 Sunday, 20 April 2014

    will the senators do their job and push to dismantle asic?

    or what if they keep medcraft on to run the 'new' asic? what a ballsup that would be? they could keep the fox in charge of the chickens and just change the coup... maybe fear of the past is catching up with me... i want to believe this enquiry is different but should i?

    medcraft seems to be too confident? as if he is giving the senators advice! this man is arrogance personified...

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