Click on our Secret Library of Evidence ------>

    BANKILEAKS Secret Library

Loan Application Forms (LAF's)  

    Bank Emails to Brokers  

    Then Click on 'VIEW NOTEBOOK'

Join us on facebook

facebook3           facebook2 


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.


Articles View Hits

Whistleblowers' Corner!

To all mortgage brokers, BDMs and loan approval officers! 
Pls Call Denise: 0401 642 344 

"Confidentiality is assured."

Cartoon Corner

Lighten your load today and "Laugh all the way to the bank!"

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.

Click on the Cluster Map.

  • Home
    Home This is where you can find all the blog posts throughout the site.
  • Categories
    Categories Displays a list of categories from this blog.
  • Bloggers
    Bloggers Search for your favorite blogger from this site.
  • Login
    Login Login form

BFCSA Bombshell: Secret Serviceability Calculators Class Order Exemption 05/1122 left consumers exposed to risky, toxic LOW DOC MORTGAGE LOANS

  • Font size: Larger Smaller
  • Hits: 2964
  • Print

Senators need to question:  ASIC Commissioner Greg Tanzer, Director Malcolm Rodgers and ASIC General Counsel Brendan Byrne as to why they signed Dec 2005 Class Order 05/1122 – exemption on serviceability calculators for Low Doc Loans – risks to consumers: 15 Dec 2005

In May 2005, IFSA suggested, according to the Wheeldon evidence (2nd April 2014), that if ASIC lawyers did not sign off on the EXEMPTIONS for Superannuation Calculators they would lean on the Commissioners.  

Parliament would put in place laws to protect consumers and ASIC would then give exemptions from prosecution to the Banking Fraternity - the very people who had been preying on vulnerable Australians for years.  The laws were to protect people.  ASIC gave immunity to the Bankers and left consumers exposed to catastrophic losses of homes and life savings.

The Sub Prime purpose of all these calculators: to entice and entrap consumers into RISKY strategies, investment advice, toxic loans etc..........all of benefit to the Bankers, Insurers and Superannuation Giants.......................with no benefit, yet all risk to consumers.  

I feel a dormant scandal is just about to explode onto our economic landscape.  Just as IFSA raided ASIC premises and demanded exemption priorities, must of been akin to a Mokbel May 2005, the Bankers and Insurers were lining up, banging ASIC desks, saying ME TOO!

Class Order 05/1122 will become the biggest disaster of them all and will force the EDR's FOS and COSL to re-open all their closed consumer files dating back to 2002.  The stated Banker Target Market was worth a whopping big $50 billion...and I witnessed this phenomenon (front row seat) as invited consumer advocate at Macquarie Bank, Martin Place in 2005.  It all makes sense now.  ASIC luminaries rolled up.   I sat stunned and said to the chap next to me: "My God, they are going after the pensioners after running out of retirees mired in MIS scams"...................  The speakers were saying "Go after new markets.....$50 billion in CBD properties owned by ARIP's (asset rich and income poor).  The audience: 1000 financial planners and brokers.........We had no idea the meetings were already taking place re Bankers lobbying ASIC Commissioners (upstairs in 1 Martin Place) for EXEMPTIONS FOR secret serviceability CALCULATORS.  Why?

Brokers had been using these calculators for three years and earning mega buck profits for greedy bankers.  Commissions were paid by the bankers and brokers dealt direct with the banks.  Banks needed the calculators to fudge pensioner income figures............................

For three years unlicensed brokers had been breaking the law, yet Banks assured Brokers the secret serviceability calculators MUST BE ATTACHED to all Loan Application Forms for Low Doc Mortgages..........................Brokers were also assured the bank lawyers (begins with "G") were satisfied the calculators were compliant with legislative protection mechanisms for consumers.  Nothing was further than the truth.  Laws were in place to protect consumers from predatory lending practices by bankers.  

Exemptions opened up the flood gates for large scale sub prime predatory market worth a bank estimated $50 billion.

ASIC effectively threw every potential consumer Low Doc Loan victim out of the 37th floor window of ASIC in Martin Place, Sydney.  ASIC was a grateful tenant of Mackers.  Within 7 months, the CO 05-1122 EXEMPTION was signed by General Counsel to ASIC, Brendan Byrne and then Malcolm Rodgers wrote the actual Policy.  Kinghorn pushed ahead with RAMS and won 48% of market share.  The Four Major Banks pushed ahead further to reach a giddy 85% market share of toxic Low Doc markets.  Those with loans 2002 - 2005 were already doomed to lose their homes and the banks wanted more of the same..........................

Loans already written 2002 – 2005 using the calculators, were unlawfully prepared by unlicensed brokers, instructed by bank officers known as BDM's.  Broekrs were told they were "helping" people.  Banking Ombudsman stated publicly in 2001,  "Brokers are the Agents of the Banks."  Result: ASIC exempted all banker agent/brokers from prosecution permitting the use of the calculators to exaggerate incomes on Low Doc Mortgage Loan Application Forms.  In 2006, I was already complaining to ASIC about "ABN for a DAY scams," referred to by the Bank BDMs in generic emails sent to 15,000 Mortgage Brokers across all states.  ASIC Barrister Brendan was a very busy boy in 2005..............just as Errol Hoopman had been in 2001.


 On 15 December 2005 ASIC General Counsel Brendan Byrne – signed Class Order exemption from prosecution for unlicensed brokers using the banker engineered (internal) serviceability calculators.

Class order 05/1122 signed by Byrne 15/12/2005 and effective 20/12/05

1.       Bankers engineered the Serviceability Calculator and other calculators in 2002, just before the new consumer protection laws were introduced.

  •       ASIC exemptions on calculator and policies 2005
  •       BFCSA’s discovery of calculators in terms of abuse 2012 – evidence to Senate
  •        BFCSA’s evidence in chief and submissions to Senate.  Specific differences in these Calculators
  •        Brokers verify the actual processes used 2002 – 2014 re Low Docs and Serviceability Calculators

1)      Bankers engineered the Serviceability Calculator and others 2002

In 2004, Malcolm Rodgers and Greg Tanzer  realised Brokers were unlicensed, yet 2002 – 2005, Bankers required brokers to sell Low Doc products and were using engineered service calculators to create false incomes…..therefore acting in contravention of 2002 consumer protection laws.

Consumers were left exposed to high risk non affordable loans 2002 – 2005 as banks had insisted their brokers use secret internal SERVICEABILITY CALCS as compulsory for approval purposes.  These calculators were critical to show “futuristic incomes.”  We now see those incomes as “grossly exaggerated” and a fraud.  The system permitted Banks (according to bank emails) to pump up the volume on sales.

 As standard Industry Practice: “ each Low Doc Loan Application must be attached to the one page SERVICE CALCULATOR and it’s one page worksheet. “  Bank to Broker emails via the Bank officers offered this information as to procedure.

 Brokers had been using the engineered SERVICEABILITY CALCULATORS for three years and complaints began to arrive.

  ASIC exemptions on calculator and policies 2005

 QLD ASIC Commissioner Greg TANZER decided to assist banks by granting an EXEMPTION for compliance by non licensees, by way of a Class Order: [CO 05/1122]  (In 2007 Tanzer took up one year stint at IOSCO).

 During 2005,  ASIC exempted 5 calculators already in use by non licensed sales people.  These internal calculators (Super, Insurance, Mortgage Loans, Investment Calculators and one other) were lobbied for by the Bankers and their Insurers……………………..

 Serviceability Calculators (named as generic financial calculators) were not available for the PUBLIC – only for internal use and by Brokers selling Bank products – yet law stated cannot be used by non licenseesConsumers were never to see these two documents, yet significantly these two pages contained their customer’s personal private financial details. 

On 20th Dec 2005, ASIC released IR 05-64  ASIC releases Policy on Calculators and CO 05/1122

It includes:

‘Financial calculators can help consumers to inform themselves about financial products and services, particularly as most calculators are on-line and easily accessible. Our policy and relief will make it easier for industry to provide these calculators by electronic and other means,’ said ASIC Executive Director of Regulation, Mr Malcolm Rodgers.

‘However, ASIC is also aware that calculators can mislead consumers if they are not designed responsibly.

3)         BFCSA’s discovery of calculators in terms of abuse 2012 – evidence to Senate

Consumers have been unaware until recently of this document’s existence yet was attached to their LAF after signature obtained.  BFCSA, brought this matter to the attention of ASIC 2012 – 2013.

  BFCSA’s evidence in chief and submissions to Senate 2014.   Differences in these Calculators

In ASIC’s supplementary submission to the Senate Inquiry into ASIC Performance……………………….ASIC attempted to portray the calculators as being available to the public and the serviceability products as being similar.

ASIC supp sub in answer to BFCSA #45.1 Page 29 @ pt 119 :

119 Similar calculators are often provided for prospective borrowers to access online,

ASIC attempted to mislead PARLIAMENT that the online bank calculators are “similar” to the SERVICEABILITY CALCULATORS, I discussed in my evidence on 20th Feb to the Senators.    Currently, Banks deny borrowers the right to copies of the printout document from SERVICEABILITY CALC.  All borrowers are refused in their quest for a copy.

DIFFERENCE:  Online PUBLIC generic bank calculators (they all have them on bank websites) allows any member of public to see 1) how much they could borrow and, 2) over how many years and, 3) the approx payment per month.  No income is placed in this one….just very simple. Access to anyone who has a computer.  It is a generic calculator.

THE SERVICEABILITY CALCULATORS were engineered by the Banks (according to Commissioner in Feb 2013).   

The mechanics: The serviceability calculator expressly used complex add back and add on’s and tax advantages, govt incentives – complex mathematical algorithms, etc.   Brokers said “without the calculator we would not know which figure to place on the LAF. We did not pluck income figures out of thin air.”   The exaggerated figures came from the computer program driving the service calculator.  Commissioner and I agreed on this point Feb  20, I handed him 200 emails from Banks to Brokers:   Bank Emails to Brokers     and he admitted he had already received the 160 BFCSA Member complaints with Loan Apps riddled with fraud: see links top of home page under "breaking news."

·         ACCESS to this calculator was only granted to the bank officers, credit assessors and broker agents with lenders' PASSWORD.

·         This calculator DISPLAYED WARNING: “not to be shown to borrowers.”  ·         FOS and ASIC will not assist consumers in discovering this document


BROKERS verify the actual processes used 2002 – 2014 re Low Docs and Calculators

My chats with several Brokers during past year – some Brokers back to 2002.  Others in New Zealand – same model:

Banks will not release this one page document which was attached to every Mortgage Loan Application Form.   LAF (bank to broker emails state: “must be attached to Loan App or we will not process your deal.” 

Ex Brokers tell me this is true – Last week I spoke to Alexander re his experiences with serviceability calculators and the 2005 EXEMPTION

Alex (ex Broker) states “it was compulsory to send calculator to banks for processing, attached to LAF otherwise paperwork would be sent back to us and risk the deal being rejected.   

“We could never ever show the calculator or print out to the client.  That’s was forbidden.  We were taught to go back to office after the three pages signed and then add all the other pages and fill them in using the information from the calculator.”

ASIC is currently suggesting the calculator was merely a tool….an aid for brokers to use if they wish………………not true.

Clearly ASIC chiefs knew risks to consumers in permitting calculators to project futuristic incomes without the client’s knowledge or consent.  If this was a legitimate process then why the secrecy and failure to produce copies for over 12 years; as standard industry practice.  ASIC must have recognised the INTENTION TO DECEIVE by bankers and the purpose and motivation of the deception.

Dilemma for EDR's COSL and FOS:  You will now have to re-open all the fraudulent files - complaints from consumers against Banks and Lenders, you have been closing since 2002.................................


Denise L Brailey

Banking and Finance Consumers Support Association (Inc)

This email address is being protected from spambots. You need JavaScript enabled to view it.">This email address is being protected from spambots. You need JavaScript enabled to view it.

Mob: 0401 642 344

Time for every victim of Bank Scams to write to the Prime Minister and ask for a Royal Commission into Banking & Financial Products and Services Sector.


Last modified on
Rate this blog entry:


  • doyla66
    doyla66 Thursday, 03 April 2014

    what the hell is going on! ASIC happy to ping a few rogue brokers, and pat themselves on the back for their efforts... but it is PROVEN they knew about the big 4 banks years ago. The big four are the culprits teaching the rest how to steal our assets and hard earned cash.

    Now watch the rest of the Bank CEO's "retire" from their positions for family reasons.. as has NAB chief Cameron Clyne.

    I for one do not believe this is the MAIN reason..

    " but in a rare step for one from the upper echelons of business, Cameron Clyne decided to put his family first and retire."

    Read more:

  • doyla66
    doyla66 Tuesday, 15 April 2014

    I actually feel sick to the bottom of my heart reading this. It is just as I suspected and as I wrote in my previous submission to the senate - the banks, their lawyers, the brokers, et al were all protected by layers of cotton wool. Corruption of the worst scale at the highest levels using us as toys while lining their greedy grubby backpockets.

    I know what I would like to soak those layers of cotton wool in and light the flame - they deserve to burn in hell with their ashes buried beneath black tar. . .

    Now, will these Senators this time have the backbone to really make solid recommendations? None of that wishy washy voter blackmail will suffice! You are in, elections are over. Call the bloody Royal Commission - no more excuses permitted!!!!!

Leave your comment

Guest Sunday, 29 November 2020