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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: “We’ve opened the biggest economic can of worms since federation,” Professor Fels

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Business heavy-hitters warn against panic over Hayne

Sydney Morning Herald 4 February 2019 12:01am

Sarah Danckert, Clancy Yeates


EXCLUSIVE  Business leaders have warned it would be impossible to remove all risk from the banking sector and trying to do so would hurt the economy, as the Federal Government is set to release the findings and its response to the final report of the Hayne banking royal commission.

Calling for calm ahead of Monday's release, former Reserve Bank Board members and financial regulators have also cautioned all sides of politics from turning the final report into a point scoring exercise and to be sensible in their response or risk the economic consequences.

Amid concerns of a panicked response from government, former RBA board member and long-time Woolworths managing director Roger Corbett said clamping down on risk-taking by banks could have economic consequences.

“Whilst I think there has been some inexcusable pieces of behaviour by banks we don’t want to create a situation where banks can’t take a risk in lending to people and can’t recover against the collateral when that is warranted,” Mr Corbett told The Age and the Sydney Morning Herald ahead of the release of the report.

“I’m just worried out of all of this that very important risk equation could for political reasons and other reasons get misaligned, and if that if that is the case that could be very bad for the community and the banking industry.”

Mr Corbett added: “It would be unfortunate if it became a political element in the election because this is a very important royal commission for the future prosperity of our community.”

Former ACCC chairman Allan Fels – a former proponent of vertical integration and also the man responsible for major reforms to executive pay – says the task of implementation will be nearly impossible for government.

“We’ve opened the biggest economic can of worms since federation,” Professor Fels said.

Professor Fels said Commissioner Hayne could recommend some radical structural solutions to lessen misconduct including stopping the banks from offering financial advice while also supplying products and creating official oversight of bank remediation programs and stamping out all commissions and bonuses.

But he warned such changes would be very difficult and could easily become a “political football”.

“The remuneration question is not simple. Suppose he were to recommend the drastic medicine of fee for service in place of any commissions or bonuses there would be myriad of difficult implementation challenges,” Professor Fels said.

Donald McGauchie, a former RBA board member, and current chairman of AACo said he had been horrified by some of the conduct revealed at the royal commission especially in the wealth management sector but he too warned the banks could become “gun-shy”.

“We’re all just waiting and hoping that it doesn’t inflict too much pain on the economy because the banking system is the lifeblood of the economy,” Mr McGauchie, who is also the former chairman of Telstra, said.

“Let’s just hope that cool heads prevail -- that there is considered response from both sides of politics and there’s not too much politics played around it, that the banks themselves don’t over-react by becoming too conservative and that the regulators act sensibly as well.”

Wesfarmers and AGL director Diane Smith-Gander said the royal commission had already caused banks to become more cautious in their consumer lending, which was causing an "uncomfortable adjustment."

Although some banks had more appetite to lend to business, the greater caution towards consumers could have a "disproportionate" impact on groups in society who tended to find it harder to access credit, including lower income earners, Indigenous people, and first home buyers.

Ms Smith-Gander said government should consider this in responding to the royal commission, and not be too "prescriptive" in telling banks how to improve.

"I think the impact of the royal commission has already been felt well ahead of the final report," she said.

"We're in this uncomfortable adjustment period, and what I hope is that the government does what it should do when there are adjustments and changes in markets, that they look to ensure that people don't get disadvantaged.

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