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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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BFCSA: Banking Royal Commission could be distracted by disaffected borrowers

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Banking royal commission could be distracted by disaffected borrowers

Australian Financial ReviewJan 3 2018 11:00 PM

James Thomson


Small business and family enterprise Ombudsman Kate Carnell says banking royal commissioner Kenneth Hayne will find it "incredibly challenging" not getting bogged down in individual cases of disaffected borrowers as he seeks to balance these with broader sectoral issues.

Ms Carnell, who completed her inquiry into small business loans last year, will offer Mr Hayne a briefing on the cases it examined.

The inquiry focused on the power balance between banks and small business borrowers, which has been a particular point of contention in a number of cases involving Commonwealth Bank subsidiary BankWest.

Some BankWest customers claim their loan arrangements were suddenly changed at the height of the GFC, and are pushing for the Royal Commission to re-examine these cases.

"I think we could help him do a lot of the work," Ms Carnell told The Australian Financial Review.

While she expects the commission will take longer to complete than the predicted 12 months, she said "anything that my office can do to help that timeline we will do."

But Ms Carnell said her inquiry had shown her how difficult it is to deal with individual cases, which are often highly complex and require time and resources to examine.

"I think it's going to be incredibly challenging not getting bogged down and not getting flooded with so much paper," Ms Carnell said.

Even at a practical level, it can be a difficult for an inquiry to wrap its head around the sheer levels of documentation that individual cases involve, Ms Carnell said.

"Just even looking at the cases will be a challenge. People who are bank victims have huge amounts of paper to start with. There will be bucket loads of documents."

Her inquiry used small groups of case studies to look at broader issues, such as cases where banks were able to suddenly decide not to rollover a small firm's loan, leaving them just days before they are in default.

"That's obviously not OK," Ms Carnell said. "We saw a range of clauses like that that were absolutely nothing to do with the borrower."

But more difficult were cases involving situations where banks changed loan arrangements in response to external events, such as problems in a particular sector, or the wider economy – as is alleged to have happened in the GFC with the BankWest loans.

"The challenge with these sorts of cases is where the balance lies," Ms Carnell said. "The cases around developers are always the difficult ones and it's because of the way that developments loans work.

"It's about ensuring that the bank's reaction is proportional to the change in risk."

Ms Carnell said the banks had changed and improved the way they deal with SME customers in the wake of her inquiry, but said her office was still watching the sector closely.

"There's no doubt that the banks at senior levels are getting the message," she said.

"We are seeing a dramatic change in the way they respond to issues we might raise now in comparison to 18 months ago.

"But we are still seeing that new customer focused approached still struggling a little bit at middle management.

"We'll be keeping the pressure on them to make sure they do deliver."



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