BankReformNow's Submission To Parliament

The impairment of customer loans
Submission 116
Bank Reform Now

Taking Real Action To Bring About Real Change In Banking
www.bankreformnow.com.au
18.8.15
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Bank Reform Now Submission to Parliamentary Joint Committee on Corporations and
Financial Services re: The Impairment of Customer Loans.
This inquiry is concerned with bank engineered defaults: the practice of banks deliberately setting
up clients to fail. Hard to believe that so many people involved in banking and finance actually
make their livings by deliberately stripping bank customers of their assets often their lifes work.
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A key aim of this submission is to highlight several case studies of Bank Engineered Defaults as
told to my organisation - Bank Reform Now. The experiences of these bank customers will inform
the committee about the practices of banks and their associated agents. See pages 5 to 20 for a
more in-depth description of each case. Any fair minded person reviewing this material would
want to see to it that the families involved should be fully compensated by the institutions
responsible. While you have determined that it is not your committees role to directly arrange
justice for each and every individual victim it is critical that you take this information seriously.
These and the other cases you will be reviewing more than justify a properly constituted Royal
Commission. Pages 2 to 5 list the seven key elements of the Engineered Default. Pages 22 to
26 are important resources showing the magnitude of banking misbehaviour. The Appendix
gives a brief summary of the Bank Reform Now recommended reforms (see pages 27 to 28).
The Cases:
1. George & Erika Biritz A NAB criminally Engineered Default. Written by Erika Biritz
2. Sante and Rita Troiani - A NAB criminally Engineered Default. As told to Bank Reform Now by
Rita Troiani.
3. Malcolm Taylor - A NAB criminally Engineered Default. As told to Bank Reform Now by
Malcolm Taylor
4. Faye Andrews - A NAB criminally Engineered Default. As told to Bank Reform Now by 71 year
old widow Faye Andrews.
5. Philipp and Lynne Kreutzer - A NAB criminally Engineered Default. As told to Bank Reform
Now by the Kreutzers.
6. Elliot Sgargetta - A NAB criminally Engineered Default. As told by ABC journalist Neal
Woolrich.
7. Michael Sanderson - A Bank of Queensland criminally Engineered Default. As told to Bank
Reform Now by Michael Sanderson.
Bank Reform Now - Impairment of Customer Loans Inquiry 2015

Submission 116
We have heard many cases of bank clients who have never missed a payment being forced into a
default when property valuations have been unconscionably manipulated. It is common
knowledge in the industry that if a valuer wants regular work from a bank they need to supply
figures that suit the bank.
It is important to realise that the engineered default or constructive default does not begin and end
with fudged bank valuations at the time of purchase. Sure higher values at the origination of the
loan enable larger loans - but to really understand the full picture it is necessary to look at multiple
influences on the property market and banker activities. All of which affect the degree of financial
stress borrowers face. In addition - the engineered default can only proceed with significant
assistance from politicians, bank lawyers, liquidators, Courts and Judges.
The following step by step analysis show how the racket works. It enriches financial institutions
and governments but increases the likelihood of a default from the extremely well milked
borrower. The property market is a very good example of how the interaction between big
business and big government harms our society and our people. Everyones standard of living is
far lower and harder to maintain because of this.
Step 1 - The Elevation of Property Value at Time of Purchase:
House values and prices are directly elevated by government policy. GST, Stamp Duty and other
government generated imposts have been shown to increase the cost of buying a home
significantly. Also, governments control the release of land for housing. Limiting supply leads to
increased prices. Both these factors increase the amount that needs to be borrowed from financial
institutions.
The Property Council has shown that property owners have become Australia's largest collective
taxpayer contributing 9 per cent of total tax revenue. Property taxes make up as much as 46 per
cent of state, territory and local government budgets. [ http://www.smh.com.au/federalpolitics/political-news/scrap-stamp-duty-and-increase-gst-says-property-council-of-australia20150614-ghnko7 ]
On top of this bankers are more than happy to have dubious valuations inflate a property's value
prior to purchase and thus manipulate the Loan to Value Ratio. Once again this allows a further
increase in the amount that can be made available to the borrower.
Step 2 - The Creation of the Loan:
So the above inflated cost of property requires the purchaser to borrow more money from a
financial institution. Let's also remember that for some inexplicable reason Governments have
given private bankers the power to create credit (the history of this makes interesting reading but it
is beyond the scope of this document and inquiry).
The money that a "borrower" obtains does not exist until a promissory note is signed and given to
the bank. This is a deliberate misrepresentation of a contractual obligation. Thus the bank is
actually handing a further representation of the obligors own promissory obligation back to them

Submission 116
and then pretending it is they the bank who is giving up commensurable value in any purported
loan. Even worse, the bank then charges interest on this "loan."
If you think about this for just a very short time you will quickly understand why the world's finance
system is the corrupt, unsustainable, immoral mess that it is. You will also understand how it is
that banking is so profitable and why the wealth of the middle class is being siphoned to the upper
echelon money manipulators. I would strongly argue that this indeed is a crime against humanity particularly when you factor in that governments also borrow and then tax citizens to pay interest.
Step 3 - The Loan Application Form:
Bank loan officers earn bonuses and promotions by increasing the bank's loan book. Thus there is
an incentive to lend as much money as possible to as many clients as possible. There is then a
perverse incentive to engineer the Loan Application Form so that the client appears to have a
higher income, more assets and fewer liabilities. Figures are routinely fudged to manipulate an
LVR to less than 80%. By doing this clients are pushed into a position where the risk of default is
much higher.
Step 4 - The Struggle With A Time Bomb:
So now we have a client who has purchased an overpriced property with money that was created
through a contractual deception. The "borrower" is paying interest on this "loan" and finds that
because of a fudged Loan Application process his or her disposable income is not enough to
comfortably look after the family's needs. The kids miss out on treats and then essentials. There is
continuous worry about the finances. Holidays are few and far between. The bank has managed
to get about as much as possible of your income. Relationship stresses build. Life isn't quite so
enjoyable - it has become a struggle.
The bankers involved knew from the start that this would happen. They also knew that this was
unsustainable and that around the five year mark .... boom .... the time bomb goes off and the
mess likely ends in a default with the bank seizing the clients assets. Does the bank or banker
care? No - because all commissions, bonuses, interest payments, penalty fees, shareholder
dividends have been collected and distributed.
Step 5 - The Parasites Feast:
We have seen cases where if the above is not enough to extract as much as possible from a
client, with or without a default, bankers have been known to set up a complex web of hidden
accounts. Client funds are secretly siphoned away (stolen?) and shifted at the bank's discretion to
accounts without the client's knowledge. This inevitably leads to business cash flow problems.
Once the bank documents the difficulties the client is now experiencing the next phase is
triggered. Penalty interest rates and fees; fresh property valuations are ordered by the bank ....
and this time they show significant, often inexplicable, reductions. The LVR is now way over
100%. The bank can demand payment in an unreasonable manner. Don't forget some clients in
this situation have still not missed a payment. Regardless, at this stage - valuers, lawyers,
liquidators are called in - all at the clients expense - so you can imagine how fees are inflated. It
becomes a feeding frenzy.

Submission 116
Once it progresses to liquidation the main aim is for the liquidators to maximise their returns.
Getting the best possible return on assets sold to minimise the client's obligations to the bank are
not the top priority. Often insiders with connections to lawyers, liquidators or bankers can pick up
properties and businesses at bargain prices. This process explains how a bank victim can end up
with absolutely nothing after their assets are sold from under them. See the Biritz, Troiani and
Andrews stories (Cases 1, 2 & 4 respectively below) to see the horror and treachery inflicted by
NAB where incredibly hard working families lost everything in exactly this manner.
Step 6 - The Charade - Where Justice Is A Game:
Some bank victims know that they were deliberately set up. The injustice burns deep. You work all
your life building a successful business - providing real goods and services of real value. Then
you see the parasite class who produce nothing of real value come in to take it all away by fraud,
forgery and force. The victim may have the idea that the crime is so clear, so obvious, and so
blatant that they could go to Court and easily find justice against the crooked bankers.
Unfortunately there has been, up until recently, a hidden truth. The bankers own the Courts literally and figuratively. We have documented cases where Judges have resided in rooms owned
by banks. Cases involving Judges who made sure they sat on disputes involving their own bank.
Even cases where Judges owned large shareholdings of the bank involved.
It is very important to also understand that many bank victims lose their assets and never actually
realise that they were set up and deliberately taken down with predatory maladministered loans.
They blame themselves. They don't want to talk about it. They are embarrassed and think they
have failed their family. How do these people get justice when governments and politicians ignore
their distress and turn a blind eye to bank crimes and corruption?
What hope does a victim have with no resources as a direct consequence of a banks predatory
actions? Because our legal system has become monetarised - by taking the assets - the bank
also takes the defendant's right to a fair hearing and fair trial. Bank victim Michael Sanderson
(Case 7) is fighting as a self-litigant in the Brisbane District Court to level the playing field. He is
asking the Court to make orders consistent with the principle of "Equality of Arms," which the
Australian Attorney Generals Department says must be observed to ensure equality. He is not
just asking the court for minimal legal assistance resulting in crucifixion, rather legal assistance
that is equivalent and equal. He makes a very good argument, that in the case where the plaintiff
(the aggressor) has a disproportionate advantage the plaintiff should underwrite the defendant's
costs.
Step 7 - The Protection Racket (aka Insurance Policy):
You will have noticed that the above six steps are overflowing with bad behaviour much of it
already illegal. What may not be illegal is immoral, unethical and just plain mean, nasty and
despicable to put it mildly. Of course none of these crimes should be allowed to happen.
Perpetrators should be severely punished and victims should be compensated. Why does our
Justice system appear to be malfunctioning?

Submission 116
The financial institutions that profit from a non-functioning legal system are paying protection
money to both the main political parties in Australia. These are not just vicious rumours or
scurrilous accusations. I wont spell it out here, suffice to say over the years millions of dollars
have been paid by the big four banks to the big two parties.
For more details you can perform searches such as this at the Australian Electoral Commission:
http://periodicdisclosures.aec.gov.au/Donor.aspx?SubmissionId=55&ClientId=19045
It really appears that politicians are not looking after the interests of citizens as far as finance
system crimes are concerned in large part - due to a conflict of interest involving party funding.
Another aspect of the protection racket is the inaction of the police, regulators and Courts. They
appear very reluctant to investigate fraud, forgery and other bank crimes. Victims are routinely
given the run around - with each player just referring them away to another of the players.
Regulator terms of reference are rigged to protect the bankers. This game must be stopped.
Much of the above seven step process is well illustrated in these seven case studies. This is
heartbreaking reading.
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Cases of Bank Engineered Defaults as told to Bank Reform Now

1. George & Erika Biritz A NAB Criminally Engineered Default. Written by Erika Biritz
In 1984 a NAB employee advised George Biritz that the NAB was prepared to consolidate all
borrowings under a facility for Litchurch Pty.Ltd as Trustee for the Biritz Family Trust, providing the
business with extra working capital, and the loan should be a foreign currency loan in Swiss
Francs equivalent to $A 550,000. The bank also advised Mr Biritz that the following properties
were required to be held as security to the draw down $550,000 facility.
The properties requested by the NAB were:1) The matrimonial residence at 3-5 Paxton Drive, Glen Waverley;
2) Factory at 39 Kembla Street, Cheltenham;
3) Factory at 41 Kembla Street, Cheltenham;
4) Apartment 92 at Acapulco, Surfers Paradise, Queensland.
The registered proprietors to those properties were Mr & Mrs Biritz, and the Biritz's consented for
the NAB to registered mortgages against their respective titles.
The NAB insisted that Biritz's establish a Sinking Fund with the bank at Moorabbin. This fund was
to generate sufficient monies to repay the principal and interest of the loan facilities. Biritz signed
the monthly transfer debit with the NAB, and the bank from 18th August 1984 withdraw $10,000

Submission 116
every month until December 1987, being the total of monthly transfer of $410,000 for that period
of time.
Subsequently Biritz also paid upon the NAB's demand, for "top up" deposits to the credit of the
sinking fund of $250,500 over and above the monthly $10,000 transfer. All these money were
stolen by the NAB from the term deposit Sinking Fund. This was just the beginning of a series of
NAB misleading and illegal activities.
In 1985 Biritz purchased another property at Lot 54 Springvale Road, Keysborough. The property
consisted of 20 hectares with a 5 acre dam and in 1986 Biritz arranged for plans to be drawn up
for a construction of a 102 square residence. In 1987 whilst Mr & Mrs Biritz were on a trip around
Europe, the NAB management team strategically plotted the financial and professional demise of
Mr George Biritz.
On 15th June 1987 NAB without given authority by anyone whomsoever, (illegally) transferred all
the 5 properties from Mr & Mrs Biritz as joint proprietors to a sole/single proprietor of Mr George
Biritz and registered falsification mortgage instruments over each and every title deeds. The Biritz
family returned from their holiday in Europe, oblivious to the impending false claims of mortgage
defaults soon to be made by the NAB in the Supreme Court.
In between 1990 to 1995 NAB obtained possession of the Biritz's properties via the Supreme
Court and sold each one of them. In order to conceal all of those fraudulent activities, on 22 July
1997 NAB presented Mr Biritz with a sequestration order, allegedly issued by the Federal Court of
Australia.
On 13 July 1998, Mr Biritz filed an Application with the Federal Court pursuant of ORDER 35 Rule
7 sub-rule 2b. Biritz sought to set aside a Sequestration order made against his estate which has
been procured by NAB engaging in fraud. During the course of proceedings His Honour Anthony
North J. made an order which obliged NAB to account by 5pm 21 April, 1999 for all the sale
proceeds of the Biritz properties being credited with the NAB.
Although 16 years has passed since North J. made the order, the NAB has yet to deliver their
accounting. Unfortunately however the consequences have become catastrophic. Notwithstanding
the fact that the Biritz family was made penniless and homeless On 27 August 2007 Mr George Biritz passed away. Almost all my adult life has been invested into
this case and there is no way that I can walk away from it. The only option for me is to deliver
justice for my family so as to honour the legacy of my late husband.
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2. Sante and Rita Troiani - A NAB Criminally Engineered Default. As told to Bank Reform Now
by Rita Troiani.
By 1993 the Troianis brick works, Wide Bay Bricks, was the second largest private brick
manufacturer in Australia. NAB was keen to get the couple to bank with them - but getting their
business was really part of an elaborate setup to steal the multimillion dollar assets that Sante had
built up after decades of hard work. Once NAB had the opportunity it engineered a default. Using

Submission 116
the well-oiled machine of the "Shadow Ledger" and friendly - liquidators, lawyers & Courts NAB
stripped the couple of all their assets. Sante was left penniless by NAB and died after suffering a
stroke in 2007. His widow Rita has had to struggle on a pension.
Once the case was thoroughly investigated it became clear that right from the start NAB was
actively working against Sante's interests and in fact was helping Sante's competitor
NAB has a very big debt to pay the Troiani family - justice will be done. Particularly now that a
fresh analysis of bank documentation has identified exactly how NAB manufactured the default
and stole a lifetimes work from Sante Troiani. The Troianis were set up by NAB, their lawyer and
their accountant. Money was siphoned through hidden accounts to deliberately impair cash flow.
The letter (link below) from Rita Troiani to
who found in favour of
NAB (coincidentally his own bank) tells you the story as known at that time. The rest of the story
has only recently been fully elucidated. This is a distressing read but it shows why NAB has the
worst reputation of the Big Four. It also clearly proves the case that bank reform is needed.
Rita Troiani's signed Letter to the Judge summary see the last 2 pages in that documents Appendix).
- (for a brief and powerful
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3. Malcolm Taylor - A NAB Criminally Engineered Default. As told to Bank Reform Now by
Malcolm Taylor
Farmer - Malcolm Taylor is a community leader and former President of the Shire of Lower
Chittering.
In 1994 an abattoir known as Tip Top Quality Meats was to be shut down, the impact on his home
town would have been profound. Several hundred workers would be sacked and forced to leave
the district with the flow-on disaster of downsizing schools, policing and other essential services,
effectively destroying the hub of their community.
Malcolm and two others sought to buy the abattoir to save their way of life.
They had to deal with NAB and the existing owner whose company structure was essentially
insolvent.
In the period when negotiations commenced, NAB effectively concealed crucial information and
assessments from the purchasers. NAB encouraged the sale to divest itself of a failed business
which was without assets to cover its debts and pass their own exposure on to the buyers, of
whom only Malcolm had substantial assets, his two successful wheat and sheep farms just south
of Moora, a couple of hours drive north of Perth.
In a process of legal discovery Malcolm found documents from the period of negotiation. These
included: bankers' notes; memoranda; and internal assessments. These notes had been taken
from orderly files and deliberately scattered randomly to cause confusion. Malcolm asked for and

Submission 116
was given permission to photocopy everything. He took his own copier into the law firm
representing NAB whereby the question of client privilege was waived and confidentiality ceased
to reside in these documents.
It thus became clear that NAB found the abattoir to be the worst managed company they had
come across in many years of banking. At a meeting with the company Managing Director - Mr
- it was made clear that his company was insolvent, although when typed up the notes
were altered to say - whilst not technically insolvent etc.
The objective of NAB was to conceal the true situation by hiring and arranging payment for an
investigating accountant whose covert purpose was to manipulate events for the bank so that a
sale could ensue and who, thereafter, conveniently disappeared.
Basically there was an orchestrated scenario to dupe Malcolm into placing his assets in NAB's
hands to replace the bankrupt owner's debts which clearly were never going to be repaid to NAB.
Part of the plan was to have a purported representative of the seller, who was secretly engaged
by the bank, tout the abattoir as being valued at better than $15 million.
Banking notes revealed: "Whilst the Company may not be technically insolvent it surely is
struggling to meet its obligations as and when they fall due. Our dissatisfaction with the company's
financial reporting and monitoring was aired and we reiterate that for a company of its size and
indebtedness it is amongst the worst we have encountered in our time in banking. the quality of
information we are being fed is poor and that there is a problem with existing accountant. we
should be turning up the heat on owner to sell. Timing is now critical as with the lack of
throughput our position is deteriorating each day. we could not have orchestrated a better
scenario to manage and service our exposure."
NAB offered to finance Malcolm's purchase of the abattoir's assets. However, unbeknownst to him
at the time - NAB was in possession of a valuation of the abattoir and the business - a total of $3.8
million. It was ultimately bought for $4.5 million.
At settlement NAB acted as financier and settlement agent for both buyer and seller.
Instead of $4.5 million as per the agreement, $4.75 million was paid to the seller by NAB. The
bank immediately took the cheque back and started disbursing funds from the additional $250,000
without authority.
Consequently the new business was immediately under financial stress with little working capital.
Notwithstanding this, NAB continued to withdraw unauthorised amounts from the abattoir
accounts. The business was insolvent right from the start - and eleven weeks after Malcolm
purchased it a receiver was called in.
Amazingly, it was not until July 2008 that Malcolm discovered by a search of Landgate records
that the transfer of the abattoir land and assets had never taken place. This is critical - the stamp
duty on the sale and the transfer of the land and business was never properly finalised.
Malcolm fought NAB's efforts to throw him off his farm. NAB used their vast legal team to harass
him mercilessly. Eventually in 2006 Malcolm settled with NAB for much less than the bank was
demanding. Malcolm also managed to regain complete control and ownership of his farms. NAB

Submission 116
knew they were in big trouble over this deal - that's why they settled without taking Malcolm's
property. NAB is not off the hook.
Fighting on, Malcolm applied for to the WA Supreme Court on 5 December 2008 for discovery of
documents prior to issuing a writ so that he could assess whether he had grounds to proceed.
Malcolm sought only two core documents regarding the multimillion dollar transaction. These
should have been easy for NAB to locate. NAB had a very big problem though - the documents
crucial to the false acquisition, did not exist.
The Master of the Court refused the application out of hand. Such a small and easy request
would, if granted, have pushed the bank into a declaration on oath that the documents could not
be found. NAB could never have produced them. The Master was not on the side of the battlers
but of the big and powerful bankers.
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4. Faye Andrews - A NAB Criminally Engineered Default. As told to Bank Reform Now by 71 year
old widow Faye Andrews.
My annihilation by NAB:
I live in Sydney and have been a customer with NAB for 46 years (also - my husband was a
manager with NAB decades ago). In 2010, my facility expired and as before, I expected to
refinance my loans.
I had not missed a single payment of interest and had sufficient income together with $865,000
Term Deposit which met a shortfall interest on a vacant property in Parramatta. This property is
equal to the best in Parramatta in terms of location and size was subject to Council's changes to
the DCP - which was but a matter of months away - and I expected to be allowed to wait for the
DCP to be tabled. Changes to zoning meant that my property would increase in value by at least
$2 Million.
For no better reason than I "was eroding the Bank's security" - the NAB foreclosed. The NAB
froze my $865,000 in Term Deposit and then, instituted Penalty Interest of 15.9% - which, of
course, I couldn't fund.
They appointed Price Waterhouse receivers who refused to allow my tenants of over 20 years to
proceed with a signed, witnessed Contract of Sale to purchase another property which would then
have meant that the remainder of my properties would not have to be sold.
Price Waterhouse then proceeded to sell my properties, including a magnificent block of Units in
Edgecliff. They sold it for less than the NAB's valuation and allowed the purchaser, a developer, to
put the units for sale the day following exchange of Contracts on 5% deposit. He sold 8 of the
Units on this first day - at extremely cheap prices; $480,000 compared to recent sale of
comparable unit in adjoining block for $710,000. Speed was the order of the day.
They also allowed him to continue with my Strata application under my Company name and by
the time settlement was due - 6 weeks later - the building was strata titled and sold - and the

Submission 116
developer made in excess of $2,000,000 profit. It was the same with the remaining properties.
Though the sales of my properties were completed in 6 months, Price Waterhouse didn't close the
file for 20 months. Eventually, with "losses" cited by Price Waterhouse, NAB then evicted me &
sold my home for $1,640,000; the following sales in close proximity reached over $2,030,000. The
NAB used up the $865,000 term deposit in penalty interest and now say I owe them
approximately $120,000 for "losses." This is after humungous fees charged by Price Waterhouse
over 20 months.
Along with many others who have been annihilated by NAB and other banks, my health has
suffered dramatically. I have a relatively rare autoimmune disease which affects the veins in my
head - akin to walking around with a live hand grenade.
After working alongside my husband (deceased) for an average working week of 72 hours for
most of our lives - I am destitute. Price Waterhouse told me "start again." I'm nearly 70 years old
and completely worn out.
How is it possible in Australia that the bank can prevent us from using our own funds to pay our
mortgage?
____________________
5. Philipp and Lynne Kreutzer - A NAB Criminally Engineered Default. As told by the Kreutzers.
When, in 2011, the NAB began its campaign of bullying and intimidation against us, by
manufacturing defaults and setting up predatory loans designed to fail, we had been loyal
customers for over nineteen years. Over that time we had had more than twenty different loan
facilities and accounts with the NAB. Not one had ever been in default. We had had a good
relationship for many years with our local manager and trusted his advice.
In 1998 we bought land in Northern NSW and established an organic coffee plantation from
scratch. Prior to this we had been country solicitors who had become increasingly disenchanted
with the legal profession. Our families had farmed for many generations, so the change of career
was not too radical a move. For fifteen years we toiled through the usual vagaries of farming drought, flood and cyclones, planting and tending the trees, harvesting, processing, roasting and
packaging coffee. We won over forty medals for our coffee and after about ten years of hard work,
our plantation finally began to break even. During the last three years that we owned the farm it
had become a profitable enterprise.
In April 2011 we approached the Bank for an extension of $100,000 on any one of our numerous
facilities. We needed this money to undertake renovations and to cover the shortfall in income that
we expected when a rental property we owned became vacant. We estimated it could take up to
twelve months to find a replacement tenant due to the nature of the property and the depressed
market. In fact we found a new tenant just on the twelve month mark.
The Bank agreed to lend us the money, but only as a new loan and only for effectively a five
month term, upon which it had to be repaid in full. We told the Bank we didn't believe it was
possible for us to meet this short time frame and again requested that any of our existing
10

Submission 116
mortgages be extended by the $100,000, as all had ample equity. Failing that, we asked at the
very least that the Bank give us a twelve month term, as we felt confident we could meet this time
frame to repay the loan. The Bank refused, and as they held all our properties as security, we
couldn't raise the money with any other lender. Unable to negotiate more suitable terms and
needing the capital, we accepted the only offer on the table. We hoped that things would work out
and we could sell the properties as demanded, or at the very least that NAB would renew the loan
after five months expiry date when they saw that we had continued to maintain all our loans in
order.
When we went to sign the mortgage we discovered that the Bank had included all our other
properties as security for this $100,000 loan. This was inappropriate and unnecessary
given that the combined value of these properties was some eighty times the amount of the
new loan. We had not agreed to this, but once again the Bank would not negotiate with us. As
this loan was a consumer loan and was regulated by the National Consumer Credit Protection Act
(NCCP), it was a breach of that Act for the Bank to lend money unless it had determined the loan
was "not unsuitable." This loan was clearly not suitable to our circumstances and we told the Bank
we didn't think we could repay it in the short period the bank was insisting upon. There were a
number of suitable alternatives but the Bank refused all of them even though their position would
have been as equally protected. Additionally, the Bank had included our principal place of
residence as security, which is prohibited by the NCCP Act.
In retrospect it is clear that NAB were setting us up for default so that they could use this
predatory loan to seize all our assets.
Then in December 2011, without any warning or statutory notice, (as required under the NCC),
NAB sent us a letter informing us that it had commenced recovery proceedings against us
for all money owed i.e. $4,000,000, not just the $100,000. Most of the loans were ten or more
years old and had been used to buy the farm and establish our coffee business and to purchase
several investment properties. This had been done with a view to providing for our retirement
down the track, as we had no superannuation. We had not been irresponsible with this borrowing
and had always been able to service the loans and had never missed a payment.
The Bank gave us no prior notice it was about to take this action even though a few days earlier
we had met with the new branch manager to discuss amalgamating several loans in order to
obtain a better rate of interest. This letter was extraordinary in that it did not state why NAB was
taking enforcement action, or what loans or amounts it referred to and the author, described as a
"senior legal counsel" did not provide their name or contact details on the letter (which is a breach
of the Legal Practitioners Act) so we could not contact him / her and ask why such a distressing
letter had been sent. I emphasise again, that not one payment had ever been missed, and we
were paying the Bank more than $340,000 per year in interest.
NAB also sent this enforcement letter to my elderly parents who were co borrowers in relation to
two of the investment properties we owned jointly. My parents were in their late seventies and, as
could be imagined, were extremely distressed to be told that the Bank was taking action against
them when all their loans were, and always had been, in order. The Bank also sent this letter to
our former legal practice, which we had sold some fifteen years earlier. This firm did not even
have loans with NAB and had no ongoing connection with us.
11

Submission 116
When my father rang the local manager to find out what was going on, he was told that all his
loans were in order. The manager wouldn't tell him why the Bank had sent him this distressing
and false letter. During the conversation with my father the manager told him that my husband
and I could not afford our loans, which was not only false and defamatory but also a breach of our
privacy. The NAB has never withdrawn this letter or apologised, even though it was sent to people
who either had no loans, or had loans that were completely in order and which the manager said
no action was being taken.
When we telephoned the manager to ask why this letter had been sent, she told us that it was
probably "just a hurry up" as the Bank would like to "encourage" us to sell up and pay back our
loans. When asked why, she replied that the Bank no longer wanted "our sort of business," which
we took to mean agri-loans and small business loans. The FOS case manager also confirmed this
same sentiment. Apart from describing what the Bank was doing to us as akin to crushing a
walnut with a sledge hammer, he also said that the Banks actions were "nothing personal, it is
just that the Bank does not want to support your category of loan anymore." I can tell you, from
our perspective it is very personal when a Bank bullies, intimidates, and defames you in
order to frighten you into paying back all money on threat of it seizing all your property.
We now believe that this enforcement letter is a "fake" in that it was sent to us and various people
associated with us, in order to embarrass, bully and intimidate us into repaying debt that the Bank
could not otherwise legitimately call in. Section 2.2 of the Banking Code of Practice requires the
Bank to act fairly and reasonably in a consistent and ethical manner, considering our conduct,
their conduct and the contract between us. Given the Bank had not in fact commenced action
against the recipients of this letter as claimed and hadn't sent the statutory notices, or
given the minimum 30 days to rectify any alleged breaches as is required under the NCC, it
is clearly in breach of the Code.
It could also be argued it is also a breach of the Crimes Act 1900 NSW s.192 G, in that the Bank
intentionally wrote a "false and misleading" letter with "the intention of obtaining a
financial advantage or causing a financial disadvantage." The Bank later admitted to Legal
Services Commission (LSC) that many Bank solicitors had used this pro forma letter over a long
period. We therefore believe it has been used as a tool to intimidate and frighten other people into
selling and paying back loans they should not have had to. This would not be the first time NAB
has been caught out using these tactics. Fairfax journalist Nick McKenzie exposed similar
behaviour in October 2010 in an article titled Revealed NABs dramatised debt collection tactics" http://www.smh.com.au/national/revealed-nabs-dramatised-debt-collection-tactics-20101001161b3.html
When we argued that it was unreasonable to expect we could sell everything immediately, given
the economic downturn and poor state of the property market and that we needed more time, the
Bank manager told us it was out of her hands as our file was now with the enforcement section.
We asked to speak to the author of the letter, she refused to tell us who that was or even what
state it came from. We then wrote to the Bank, protesting that it was unconscionable to call in our
loans when we were not in default. NAB's response was to begin manufacturing defaults in order
to justify their action.
This started with appointing valuers to revalue our property at considerable expense to us, in
order to try and trigger the loan to value default provisions. However even though valuations came
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Submission 116
in very low, they still showed our equity was more than sufficient to support the loans. Having
failed to trigger default by revaluation, NAB next resorted to cancelling the automatic payment
authorities without telling us, causing our loans to not be paid automatically from our accounts.
This technically put us in default until we realised what had been done and we rectified it by
paying the interest manually.
Next NAB claimed our income to loan ratio was insufficient to support the loans. We challenged
the Bank to show that this was the case. The manager came back with a spreadsheet that
misstated our income to be $120,000 less than we were actually receiving and showed interest
that was more than $75,000 higher than we were paying. Despite us providing accountant's
statements, bank statements and tax returns to prove the true position of our finances, NAB
refused to correct the mistakes.
Finally NAB said it didn't matter what our financial position was anyway as they were going
to rely on clauses in our mortgage contracts that allowed them to call in loans at anytime
without cause. At this point they also began to impose "penalty interest" (their term)
upward of 20% on several of our facilities.
Banks are not entitled to charge penalty interest; the Bank can only charge a default interest
rate where it is a legitimate pre-estimate of the extra cost of administering an account that is in
default. In our case the manager told us the penalty interest was being charged to encourage us
to sell quickly.
We lodged a complaint with FOS and during the conciliation conference the Bank manager
conceded that she had breached our privacy in discussing our personal finances with third parties
and apologised. However, in an attempt to justify its actions against us to the FOS, the Bank
dishonestly claimed we had been in default on four separate occasions. Of these, two related to a
Council Bond taken out by us and four other people. The Bank concocted a story that the Bond
had expired and they were not going to renew it. This was a total fabrication as it had no expiry
date and had always had been in order. The other two involved an overdrawing of our personal
account by a matter of $300 following overnight payments of a private health insurance premium
and a car lease payment. Both were remedied the same day.
It is important to note not one of these trumped-up defaults actually related to any of our fourteen
loan facilities and therefore they were not defaults at all. When we proved the dishonesty of
this claim NAB simply backed down. However it refused to withdraw its demand that we sell
everything and pay back all loans. By the time of the FOS conference we had already sold two
properties and had paid back four loans including the $100,000 referred to above. As a result the
Bank had agreed to give us to the end of the financial year to sell the rest, including the farm.
However, at the conference the Bank went back on this written agreement and reduced the time
to only three months (which included the Christmas/New Year period) in which to sell or hand
them over with vacant possession.
Again, this was totally unreasonable given both the state of the property market where we lived,
and the time of year, but also because our commercial properties had tenants with registered
leases, so even if we had wanted to give the Bank vacant possession, we legally couldn't. Then when we did replace the tenant that had vacated, the Bank refused for several months to consent
to the lease.
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Submission 116
These unreasonable demands and actions reveal the NAB's unconscionable intention to cause as
much financial harm to us as possible. We were only able to make repayments because we
received income from tenants and from our coffee business. Causing us to abandon the farm and
coffee business and to remove tenants who paid rent, and hand these properties to the Bank
vacant, would leave us without any income and would severely impact on the value of those
properties.
NAB wanted to put us in a position where we had no income or resources and therefore could not
fight them. Then, once they had run the debt up sufficiently by employing huge penalty interest
charges, while letting our farm to deteriorate and business to become non-existent, they could sell
the properties cheaply, taking all the proceeds and probably bankrupting us in the process.
We believe we were targeted as we were in a category of farm/ small business loans that
NAB no longer wanted and we had assets that the Bank could seize. How we had
conducted our accounts for decades, our fiscal responsibility and our long relationship
with the Bank, counted for nothing.
As concerning as NAB's behaviour is, it has been the wilful blindness of the agencies such as
FOS, ASIC and Legal Services Commission (LSC) and their failure to apply or enforce the law
that has been the biggest shock of all.
These agencies have resolutely refused to take any action against the Bank, providing various
excuses including: that there was no proof that the behaviour we complained of was "systemic"
(ASIC); or excusing it as simply the Bank making "commercial decisions" (FOS); or refusing to act
on the basis "we do not act for individuals" (ASIC); or excusing the Bank's lawyer from being
accountable for breaches of the Solicitors Rules because every lawyer at the Bank had been
doing it, and not one of the dozens of senior lawyers working there knew it was a breach and now
it has been bought to their attention they promised not to do it anymore, (LSC) and finally, that we
should simply seek other avenues of redress (ASIC, LSC).
None of the Agencies provide any right of independent appeal or review and therefore they
can get away with blatantly protecting the NAB, safe in the knowledge that no one will call
them on their bias.
As a result of NAB's actions we have been forced to sell our farm at a heavily discounted price in
order to meet the Bank's unreasonable deadline on threat of repossession. The coffee business
and income that we spent fifteen years establishing, along with all the stock and equipment has
been lost, as it had to be included in the farm sale at no extra cost, in order to induce a quick sale.
We have also disposed of two other properties in the depths of the property downturn at fire sale
prices to meet unreasonable time frames. The Bank took the entire proceeds of these sales and
would not even allow us to retain enough to cover the capital gains tax that was payable.
NAB now has the audacity to claim that all the property they forced us to sell at under
threat of repossessions were sold "voluntarily" and therefore any loss to us a result cannot
be blamed on them. The sheer magnitude of the dishonestly is breathtaking.
As the Bank does not communicate with us we don't know what their next move will be, or when.
We have refinanced half the remaining debt but still have three loans with the NAB. While these
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Submission 116
are all in order, we now know that means nothing. The NAB's unconscionable and predatory
actions have been emotionally and financially devastating, but we fight on.
All banks want their victims to believe the circumstances they find themselves in as a
result of predation is entirely their own fault, thus silencing them through fear and
embarrassment. This, together with the insidious practice of having anyone and everyone
they can sign confidentiality agreements, has been very effective in hiding bank
malfeasance. But as Bank Reform Now founder Dr Brandson says, "The jig is up."
We all need to speak up, to expose the corruption, greed and fraud. Together we can make
enough noise that won't be silenced until the system is transformed.
Thank you for taking the time to read our story. We hope it help bring about changes that will help
everyone.
____________________
6. Elliot Sgargetta - A NAB Criminally Engineered Default. As told by ABC journalist Neal
Woolrich. Also includes an update from a Protected Discloser to the U.S Securities and Exchange
Commission.
Banks under fire over last-minute changes to mortgage payout notices

5.9.14
http://www.abc.net.au/news/2014-09-04/banks-under-fire-over-last-minute-loan-payout-changes/5720516?section=business
Hot on the heels of the Parliamentary inquiry into the Commonwealth Bank's financial planning
division, Australia's major banks are under fire again.
This time, it is the practice of making last-minute changes to mortgage payout notices when
customers are trying to close out their home loans.
Lawyers say the practice has been going on for years, causing distress and inconvenience to
borrowers on settlement day.
One aggrieved customer, Elliot Sgargetta, has spent six years fighting the National Australia Bank
over his disputed payout notice, and now stands to lose hundreds of thousands of dollars in
escalating legal costs.
In 2008, Mr Sgargetta was about to sell his home in the Dandenong Ranges, on Melbourne's
outskirts, and re-finance a new property.
Three weeks before settlement, NAB sent him a payout notice, advising he would need to repay
"approximately $299,000" to close out his existing mortgage.
But with settlement looming, and a raft of logistical and financial arrangements in place, he was
suddenly blind-sided.
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Submission 116
"I got a call on the Friday evening from a National Australia Bank employee that informed me that
they'd made a mistake on that payout notice and required an extra $24,000 by Monday morning,"
Mr Sgargetta said.
"Otherwise, settlement wasn't going to occur."
That sparked a six-year legal dispute, which is still running.
This year, both the Victorian County Court and the Supreme Court's Court of Appeal found in
favour of NAB.
But despite spending most of his time working on the case and representing himself in court, with
the aid of eight pro-bono barristers over the years, Mr Sgargetta is refusing to give up.
He is now working on an appeal to the High Court.
"We were in unconditional contracts, we were stuck. So they knew that one way or another we
had to capitulate in some way," he said.
Last-minute payout changes cause 'huge amounts of distress'
The law requires banks to provide a mortgage payout amount within seven days of a borrower's
request.
However, often an estimate is provided first, and the final figure is not confirmed until 11:00am on
the day of settlement.
The banks explain the late changes as an "economic adjustment" to cover the cost of ending a
loan early.
But one lawyer, who spoke to the ABC on condition of anonymity, said last-minute changes to
payout notices are common, and can leave borrowers stranded.
"Huge amounts of distress. You have to re-organise settlement and the settlement date. All the
cheques have to be re-drawn and altered, you have removalists, you have people who have
packed up their boxes," the lawyer said.
He said that within the conveyancing industry, there is a feeling that some banks are exploiting the
system more than others.
"[Conveyancers] are very tempted to say, 'Which bank are you dealing with? Well, in that case the
fee will be $1,000. If you're dealing with this other bank, it'll be $1,500, to factor in the pain and
suffering," he said.
In a statement to the ABC, a spokesman for NAB said the bank "has always been willing to work
through issues with the customer".
"However, due to privacy and confidentiality obligations, we are unable to go into detail about the
specifics of this matter.
"As the public record shows, this matter has been considered by the Financial Ombudsman
Service (31 March 2010), the County Court of Victoria (17 February 2014) and the Victorian
Supreme Court of Appeal (30 July 2014), and each determination was found in NAB's favour."
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Submission 116
Mr Sgargetta lost his mortgage broking business because of the dispute, and now NAB is taking
steps to repossess his home.
"It's been horrific. I've got a three-year-old son, my wife's due to give birth in the next few weeks,
and I'm stuck fighting and addressing all these legal processes," he said.
Lawyers say there is a glaring hole in the law which needs to be fixed, and neither the Financial
Ombudsman Service nor the Australian Securities and Investments Commission is much help in
cases like this.
But for Mr Sgargetta, what started as a dispute over $24,000 could end up costing him several
hundred thousand dollars more, if NAB recovers six years' worth of legal fees from him as well.
The following analysis of the Sgargetta / NAB case has been provided and verified by a
U.S. Securities and Exchange Commission (SEC) Protected Discloser
All statements in this passage can be evidenced.
Sgargetta wanted to see the clauses in his mortgage that had mathematical calculations of his
"break costs" NAB refused to show him the clauses.
Sgargetta also wanted to see the top secret interest rate calculations made up in a backroom run
by NAB's
. NAB refused to show him the calculations and how & why NAB calculated
a $24,000 break fee the eve before his family were settling on their home, after NAB having three
weeks to prepare.
Sgargetta questioned
, under oath in trial, on how these payout fees were calculated
and if the public were made aware. Mr
confirmed that he did not know how payout fees and
costs were calculated as the NAB systems just pops out a figure, and affirmed that the public are
not made aware at all, it is strictly internal and private to NAB.
Because he was asked to pay break costs, Sgargetta wanted to know if the original loan money
he received came from the "under 1% Fed Reserve" emergency bail out of the NAB of over $4
billion. Or he wanted to see if the loan money came from the 7% money that the Reserve Bank
gave NAB during the GFC to stay afloat. It seems reasonable to know if the bank really lost a cent
by breaking the contract early, don't you think?
Mr Sgargetta was getting nowhere. The cover-up was blatant and unconscionable. The
engineered impairment tactics were obvious. The complicit bully boys involved just backed each
other up as though this was just some sort of game.
Banks should not be allowed to manipulate payouts at the last minute. NAB breached Sec.83 of
the National Consumer Credit Protection Act. (NCCP) - and Judge
allowed them to
do it. How come? It has become clear that Judge
made a serious mistake. Judge
affirmed that no other case has been before the court about this payout legislation and
he was in virgin territory. He found that the bank was allowed to verbalise and change payouts at
the last minute. He was wrong. Banks are not permitted to this under the Sec.83 payout
legislation. Judge
has made a significant error in judgment that potentially affects
everyone involved with a bank. This judgment contravenes the law and must be reviewed.
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Submission 116
The appeal court found that the $299,000 payment was made to NAB - openly - it was not
"without prejudice." Mr
(Barrister - working for NAB) knew that and still deliberately
misled the Court. Perjury is the term used to describe this behaviour from NAB staff and their legal
team.
NAB senior mortgage manager and Barrister
- both confirmed in
trial and under oath that no payment of $299,000 was made by Sgargetta. They lied to the court
and got away with it. Court transcripts provide unequivocal evidence showing these NAB
representatives giving false evidence which affected the judgment in their favour.
In addition, Judge
- presiding over the same case declared that he owned
approximately $250,000 worth of NAB shares ..... and refused to recuse himself from the matter.
Should Judges with shareholdings with the bank, or where they have a relationship with a
party in litigation be allowed to sit on the case?
This question is answered with this authority - Ebner v Official Trustee in Bankruptcy (2000):
"... a judge is disqualified if a fair-minded lay observer might reasonably apprehend that the judge
might not bring an impartial mind to the resolution of the question the judge is required to decide.
Even the Victorian ethics body allowed the bank lawyers to keep representing the bank after the
Court said the lawyers were witnesses that misled the Court. Can barristers and lawyers represent
the bank as Witnesses? Should Shareholders bear the fall out of the high fee bullying where a
bank's "error" of $24,000 ends up costing shareholders around a million dollars?
It's important to note that in the background the FBI has been investigating interest rate fixes
at the London Interbank Offered Rate (LIBOR).
Submissions to the Senate Foreign Bribery Inquiry say that Sgargetta was tipped off by
whistleblowers from the Victorian Legal Services Board (VLSB) to go to the FBI unit that was
investigating LIBOR. Sgargetta pushed NAB's senior staffers and
as well as NAB's Barrister and
lawyer
- to show him the
interest rate calculations they used and, suddenly a $1,000,000 Hush Deed appeared - ie they
wanted to gag him.
As the Joint Parliamentary Committee (PJC) is aware, ASIC and international law enforcement
are investigating the effect the LIBOR scandal has had on home mortgages, credit cards and the
finance system generally.
Also - as some of the PJC are aware, the Senate Inquiry into Bribery of Foreign Officials is looking
into the Hush Deed offered to Sgargetta by the NAB and
Lawyers with the approval of the
Victorian Legal Services Board of Directors (that happens to include Directors of APRA, Mining
giants, and KPMG Accountants).
The cover-ups at the VLSB are extraordinary.
Below is one report to the American Securities & Exchange Commission that the VLSB wanted to
see to prove the FBI are really asking questions about the VLSB. Is it proper for the investigated
to use their Act to investigate those who are investigating them? Were the Bank and VLSB in
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Submission 116
cahoots to pervert the course of justice? How did the VLSB know last year to use its Act to
investigate what the Independents planned for future Inquiries?
____________________
7. Michael Sanderson - A BoQ Criminally Engineered Default. As told to Bank Reform Now by
Michael Sanderson.
Dear BRN team,
Why are we fighting Bank of Queensland? A brief outline We lost our farm to the Bank of Queensland. Never missed a payment and were able to continue
to service the facility under normal terms and conditions. The bank inflated the value of the
property to get our business then decided its value halved.
Rather than continue to support us resulting in no loss to either side, they decided to sell our
property and look like getting 20c in the dollar. They took a life time of work and we now survive
on the dole and at over 60 look forward to the old age pension, instead of the retirement we were
planning. We are fighting them in the courts as self-funded litigants because we have no money to
purchase justice.
Our battle is not only with the bank but also with the monetarised legal system. I will be asking the
court to order the bank, the aggressor with disproportional advantage, to underwrite our legal
costs. I will be using the legal principle "Equality of Arms" that is supported by the Australian
Attorney General to ensure a fair hearing and fair trial.
Thanks so much for your time.
Michael
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Submission 116
PS - the graph below clearly shows how BOQ used dodgy valuations to get our business and then
steal our property.
____________________________________________________________________________
Since founding Bank Reform Now I have spoken to many bank victims who have worked all their
lives only to see the fruit of their labour stolen by predatory bankers who see their job simply in
terms of transferring other peoples money into their own pockets. A great deal of anxiety,
depression and heartache exists in our communities due to financial stress.
My own family's finances were decimated by the National Australia Bank using falsified loan
application forms to grant totally unjustifiable loans to a member of the family. As I investigated
the circumstances of that loan it became very clear that the bank deliberately engineered a
situation where default was inevitable. Why must I, now also a victim of the NABs activities, be
put into the position of giving up a large part of my life in order to attain justice and seek redress
from NAB for myself and others? The reason is because the government refuses to do the right
thing. I told NAB that apart from fully compensating me they will be billed for every minute I spend
working to settle my dispute. BRN is working with a group of NAB victims who have been cheated
out of 100s of millions of dollars. We will help these people attain full compensation from NAB.
As you know, a big part of the problem is that bank loan officers are rewarded for increasing their
loan book. Their pay, bonuses and promotions are dependent on getting increased business for
the bank. The bigger the loans and the more of them they generate the better off they will be. This
puts in place an incentive for bankers to work in their own interests and often actively against the
interests of their client this must be neutralised. Up to now CEOs and Directors have turned a
wilful blind eye to maladministration of lending because the banks profits and their own pay also
depends on inappropriate and predatory lending. Why do governments, their regulatory authorities
and their intermittent inquiries also turn a blind eye to these activities?
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Submission 116
Banking as we have come to know it is white collar crime on a grand scale. This is a systemic and
systematic failure of corporate governance.
Do you think if bankers faced real penalties for real crimes bank CEO's and Directors would
continue to allow these types of abuses? One of BRNs goals is to see real penalties applied to
discourage real crimes. The current system is not working. It does not encourage ethical, honest
banking.
The Senate has identified crime and corruption in the system and it recommended a limited Royal
Commission just into the CBAs financial planning arm. That was an inadequate recommendation
and, as expected, it was ignored by the government.
Everyone is affected by finance system crimes. Even those that don't have a bank account let
alone a loan with a bank. Our time and money is being stolen by the corrupt system we now
endure. We really could meet all our needs with far less work and stress. Getting the balance right
between work and family doesn't have to be as hard as it is for most of us.
Bank victims will only see justice when ill-gotten bank profits and banker bonuses are clawed back
.... and crooked bankers are jailed - very simple and very much achievable. In addition, of course,
victims must be fully compensated.
It really is crunch time for politicians and regulators. They can be on the right side of history and
become heroes in the fight for justice and reform. Alternatively they can side with criminals and
face the consequences.
Just to make it clear to those politicians sitting on this inquiry more and more of us understand
how the racket works. We are all being fleeced while you and your colleagues sit on more and
more inquiries. Sorry - but you fiddling while we are burning is not helping.
Call a wide-ranging, unfettered Royal Commission into the whole box & dice: Banking; Finance;
Credit Cards; Predatory Banking; Control Fraud; Credit Creation; Fraud; Forgery; Vertical
Integration; Contracts; Managed Investment Schemes; Abuse of Farmers; Liquidator, Valuer and
Judicial irregularities; Commission, Bonus and Promotion Systems. THE WORKS..!
It is long overdue. I hate to break it to you - but there is a reason, after a lifetime of work, so many
of our older Australians are dependent on the government's pathetic aged pension. They have
been screwed their whole working life by a corrupt banking and finance system .... aided and
abetted by successive governments colluding against the peoples' interests. The people are
waking up to the truth. It is a hard truth our elected representatives have deliberately allowed
criminals to profit at the peoples expense.
Thank you for your time,
Yours faithfully,
Dr Peter Brandson
______________________
Dr Peter Brandson
CEO Bank Reform Now
______________________
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Submission 116
More information:
www.bankreformnow.com.au
https://www.facebook.com/bankreformnow
Previous Bank Reform Now submissions to government inquiries:

Senate ASIC Inquiry - Note: the Supplementary Submission was censored by the Senate. The
Senators felt it was not relevant to disclose how much money the Big Four Banks contributed to
the Big Two Political Parties. They also felt it wasnt relevant to have page after page of examples
of NAB fraud and dodgy business practices exposed by their inquiry.
Submission 232: www.aph.gov.au/DocumentStore.ashx?id=646605ad-7e21-464d-8ffa400d69a93b8c&subId=31239
Supplement to 232: www.aph.gov.au/DocumentStore.ashx?id=ee66f7be-7169-482c-bef4ffd868ec8542&subId=31239
The Financial System Inquiry - http://fsi.gov.au/files/2014/08/Bank_Reform_Now.pdf
The Forestry Managed Investment Schemes Inquiry - Submission
122: http://www.aph.gov.au/DocumentStore.ashx?id=9bb1e9c7-da54-4dd9-9edf909ee6b9d240&subId=302325
Interesting Resources:
a). Bill Black explains Control Fraud - https://www.youtube.com/watch?v=-JBYPcgtnGE
b). Positive Money a). http://positivemoney.org/
b). Proposals for reform - http://positivemoney.org/our-proposals/
c). Jeff Morris (CBA Whistleblower) explains very well how it is that rogue bankers just seem to
be able to operate with impunity http://www.smh.com.au/business/comment-and-analysis/alice-in-worryland-why-financialinstitutions-must-become-prohibited-donors-20150630-gi1ewn.html
d). Evan Jones digs deep into NAB and the Troiani scandal. One of the most horrific examples
of a bank engineered default you could find to inform this inquiry
http://bankvictims.com.au/national-australia-bank/item/10975-the-sting-summary-judgementto-the-nab-by-qld-chief-justice-paul-de-jersey
e). Evan Jones digs deep into the CBA / Bankwest scandal. One of the most horrific
examples of a bank engineered mass default you could find to inform this inquiry
http://www.bankvictims.com.au/dr-evan-jones/item/10958-the-dark-side-of-thecommonwealth-bank
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Submission 116
f). International banking history explained this is not ancient and irrelevant. Just consider
what is happening in Greece right now - https://www.youtube.com/watch?v=bKwO1onXAaI
g). What is happening in Greece a very big bank engineered default
http://wallstreetonparade.com/2015/06/goldman-sachs-doesnt-have-clean-hands-in-greececrisis/
h). Liquidators commonly abuse their position of power - Indian billionaire Pankaj Oswal
does Aussies a favour by exposing the insolvency racket
http://www.smh.com.au/business/comment-and-analysis/insolvency-profession-questionedfor-one-of-the-biggest-fee-grabs-in-corporate-history-20150705-gi5ht3?skin=dumb-phone
i). The U.S Securities and Exchange Commission has a Whistleblower reward program.
Why cant we have the same in Australia?
http://www.sec.gov/news/pressrelease/2015-150.html
j). UK Bank Barclays - has set aside a total of 1.03bn for customer redress. Why are
Australian banks not required to properly compensate victims of predatory and criminal banking?
http://www.mortgagestrategy.co.uk/news-and-features/sectors/products/products-news/barclaysposts-31bn-profit-but-hit-by-1bn-redress-bill/2022848.article
k). The complete CBA Take Down of Bankwest customers - The 4 part expose by Assoc.
Prof Evan Jones - CBA under CEO Ian Narev taunts, tortures and rorts its victims no
mercy, no recourse. The lies must be exposed, the perpetrators brought to justice and the
victims compensated.
Part 1. https://independentaustralia.net/politics/politics-display/the-commonwealth-banktakedown-of-bankwest-customers-part-1,4443
Part 2. https://independentaustralia.net/business/business-display/the-commonwealth-banktakedown-of-bankwest-customers-part-two,4474
l). Assoc. Prof Evan Jones Demonstrates that there is no bank that one can trust on a
business loan. Bank corruption is causing immense harm to citizens of Australia. The case
has become strong and undeniable. To stop bank crimes we must start jailing bank CEOs.
Part 1. https://independentaustralia.net/business/business-display/to-fix-australias-bankingculture-start-sending-bank-ceos-to-gaol,8044
Part 2. https://independentaustralia.net/business/business-display/stop-the-rot-send-bank-ceos-togaol,8060
Part 3. https://independentaustralia.net/politics/politics-display/corporate-immunity-to-criminalprosecution-send-bank-ceos-to-gaol,8067
m). How long before Aussie CEOs are charged for criminal Interest Rate Rigging?
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Submission 116
n). Assoc. Prof Evan Jones summarises the Barry Landa Scandal a criminally
engineered default par excellence - In 2002, Barry Landa was induced by a broker linked to
Challenger Mortgage Management to borrow funds ($1.65m), using as security his home and
several investment properties, to invest in Perpetual Trustees Australia Ltd.
The broker,
, instead funnelled the funds (as with other victims) into a PTAL
account under his wifes name. Internal audits early discovered the dodgy accounts but PTAL
failed to act. Landa was paying off his presumed mortgage to
(summing to $750,000),
receiving fraudulent statements, with those payments also going into
accounts.
Landa discovered the scam in late 2003, with
subsequently sentenced to gaol. But PT
pursued Landa for his properties, claiming innocence with respect to
scam. Some later
Court judgements agreed. Landa lost his $750,000, his original loan escalating to $3.96m, due to
fees and penalty interest charges.
The NAB bought Challenger in 2009, and from thence Landa received statements from the NAB.
But who "owned" Landas mortgage after this transaction remains mysterious. Ultimately, Landa
paid the $3.96m to lawyers
(fearing further costs and losses in court), but which
company received the payment also remains unclear.
in refusing to return the title to his house until he signed a nonaccusatory statement. The home title was recently promptly returned to Landa after his complaints
to several politicians. Please note FOS and its pathetic involvement.
Bank Reform will not rest until NAB fully compensates Dr Barry Landa.
o). Bank Reform Now was featured in the Bay Post / Moruya Examiner on 14.8.15
Momentum is building. Informed citizens will not tolerate white collar crimes any longer.
24

Submission 116
A EUROBODALLA doctors campaign against fraudulent and predatory lending practices by

Australian banks is gathering momentum.
The Bay Post/Moruya Examiner reported last year that Batehaven doctor Peter Brandson was
leading a people-powered campaign to force change on the government and banks.
He announced last August he was offering his luxury Long Beach home as a prize for people to
join his campaign.
It stems from his own personal story where NAB approved a member of his family a sizeable loan
in 2004, which could not be repaid by the borrower.
Three years later the bank began legal proceedings to take possession of Dr Brandsons family
home, despite him not being a signatory or guarantor on the loan, nor it being in his name.
While Dr Brandson eventually stopped the repossession by refinancing the loan in his name with
another financial institution he wants retribution for predatory lending practices and negligent
conduct.
Speaking to the Bay Post/Moruya Examiner this week, Dr Brandson said his campaign was still in
pre-launch but gathering support.
The Bank Reform Now Facebook page has almost 3,000 followers and several of its posts have
been shared more than 100 times, distributing the message to tens of thousands of people.
Dr Brandson said the response had been absolutely fantastic.
Apart from the great response online - people who know me are all very supportive telling me not
to give up and that its about time someone really taught the banks a lesson, he said.
Ive also had some good interactions with several highly-respected journalists and news
organisations.
Dr Brandson said many other victims of NAB had also got in contact and the rip-offs were
horrific.
It is not just predatory lending and unconscionable conduct whereby bankers knowingly
manipulate the loan application to give an unjustifiable loan, Dr Brandson said.
Im seeing cases where people, with significant assets built up over a lifetime of work, are
deliberately set up so as to enable the bank to strip them of their property and sometimes lives.
I have come to discover that the banking system is organised crime on a grand scale.
The jig is up and Im hoping to put extra pressure on the banks and the government once the
campaign launches.
Dr Brandson said the banks had not responded to his campaign since NAB refused to settle my
matter amicably.
Ignoring victims is part of their strategy, he said.
Having weak regulatory agencies like the Australian Securities and Investments Commission and
Financial Ombudsman Service is also part of the game plan.
25

Submission 116
More importantly, while governments protect the criminals in the industry, the banks feel they can
get away with anything.
State pulls pin on giveaway
DOCTOR Peter Brandson is investigating options for the giveaway of his Long Beach home after
he was unable to offer it via a lottery.
Dr Brandson announced last August he would offer the luxury home as a prize for people to join
his Bank Reform Now campaign.
He planned to seek $2.60 donations from the community and in return would have given one of
the campaign supporters the Long Beach home which NAB tried to repossess in 2007.
Dr Brandson said this week no donations had yet been collected.
I have to get all issues sorted, he said.
We were slowed down because the state authorities didnt want to have the house offered to a
winner via a lottery.
That was my preferred option but I will still give the house to one of the campaign supporters - we
will not use a lottery.
We will have all the government approvals required to raise money for the campaign.
Dr Brandson said donations would be collected once the campaign officially launched.
He said it took time to build public awareness and momentum.
Once we have enough people power on board we can harness it to force change, he said.
This is not a flash-in-the-pan operation, we have long-term program planned with specific goals.
We need to build a solid platform to provide a strong voice to people who are sick of the
corruption that is far more widespread than most of us realise.
Join the campaign by following the Facebook page.
By reading liking, commenting and sharing the material people help the movement grow, Dr
Brandson said.
Right now we are providing a valuable source of information that helps people join the dots and
understand why reform is critical.
p). Bank Reform Now posted about the Brisbane G20 being a wasted opportunity for
genuine reform. The Comments section below that post has become a massive resource with
articles and videos showing how bad the problem of bank criminality is and some of the important
reforms that are required
https://www.facebook.com/notes/bank-reform-now/g20-australia-2014-the-golden-opportunity-forreform-lost/601564986618820
26

Submission 116
APPENDIX
The Bank Reform Now Recommendations [Summary]
1. Fair and transparent contracts.
2. Full disclosure to clients of commissions and fees as well as mortgage ownership.
3. Final signed copy of Loan Application Forms must be given to clients.
4. Bonus and promotion systems that encourage predatory lending, fraud and forgery must be abolished.
5. Full restitution and compensation payable by banks to the victims of banking malpractice.
6. Legislation introduced enabling asset seizures and jail terms for loan officers, bank directors and CEOs
engaging in criminal activities. The proceeds of crime must be far outweighed by the penalties.
7. Restrictions on the revolving door - buddy buddy relationship between government bureaucrats &
politicians and banks whereby the government is infested with ex-bankers and the banks have exgovernment officials serving on boards or other lucrative areas.
8. Whistleblowers must be encouraged to speak out and protected when they do. Possible immunity for low
level financial crime perpetrators who help bring about convictions against upper echelon criminal bankers.
9. Fix the regulators - in Australia these are ASIC, APRA, FOS and they have clearly failed. If they really
just can't serve to protect bank clients and investors from organised crime then shut them down and start
again. Real regulators must have the power and will to investigate and penalise bank crimes properly. They
also must enforce proper compensation to victims of banking malpractice.
10. Bring Justice back into our Courts. The Uniform Civil Procedure Rules 1999, Chapter 10 Court
Supervision, part 1 367 directions (2) In deciding whether to make an order or direction, the interests of
justice are paramount. The Australian Attorney General states "Equality of Arms" must be a factor to
ensure a fair trial and fair hearing. When a bank is the aggressor and pursues a client in financial distress,
particularly when they are the cause of that financial distress, there is no possibility of a fair trial or hearing
and the interest of justice could not be paramount. One method to ensure "Equality of Arms" is the bank
should be required to underwrite the costs of the bank client equally to the bank. If the client wins the bank
would most likely bear the costs anyway. If the bank wins they can deduct the costs from any proceeds of
their action. Under these circumstances it would be reasonable to expect a decrease in litigation and an
increase in real negotiation. Such measures would also have positive ramifications for GDP, the public
health and social security budget and not least the justice system.
11. The issuance of currency must be removed from the hands of the private bankers. The Debt / Interest
system that has evolved to gradually enslave the people of the world must be dismantled. Bear in mind this
simple but little known fact: The money that a "borrower" obtains does not exist until a promissory note is
signed and given to the bank. This is a deliberate misrepresentation of a contractual obligation. Thus the
bank is actually handing a further representation of the obligors own promissory obligation back to them
and then pretending it is they the bank who is giving up commensurable value in any purported loan. Even
worse, the bank then charges interest on this "loan."
Governments need to develop an effective and fair system so that they do not have to borrow at
interest. [Note: - UK's Positive Money has a lot of information about this issue see following links
http://www.positivemoney.org / https://www.facebook.com/PositiveMoney?fref=nf ]
27

Submission 116
In addition:
A. Political donations are not a mechanism to purchase government favours or largesse. Therefore they
must be fully transparent and may only be made by individuals. We propose that no individual can donate
more than $1,000 per year to the party of their choice and they should only be able to donate to one
party. Businesses (and, by the way unions) should not be able to donate at all.
The beauty of this system is that the only way for parties to raise donations is by actually earning trust and
respect from ordinary voters. This is done by displaying integrity, honesty and wise policy formulation good for our democracy and good for our people.
B. Political advertising must be reformed so that politicians and their parties are accountable. Truth in
advertising laws must apply. We encourage a "plain packaging" approach i.e. no fancy advertising
campaigns. Ads can only feature one politician making a statement regarding what they stand for and what
policies they propose. If they can't get their message across in this format they simply do not have what it
takes to lead our country. This reform will naturally limit the amount of money political parties will be
required to raise and spend before each election. We dont want the party with the best ads on TV to
govern us. We need the party with the best people and policies.
Conclusion: Taken as a complete package - the reform proposals listed here would go a long way toward
limiting the ability of banks to engage in business practices that enable the engineering of defaults. It will
reduce the disparity of power between bankers and their clients. It will see fairness and honesty become
the norm in banking and finance. Also it will encourage people to invest in productive areas of the
economy. Manipulation of money and finance is not a legitimate area for massive profits and unsustainable
growth. Banks and their shareholders will soon come to realise this.
The final word:

The downside of modern banking is actually not a new problem. Citizens and voters require politicians with
guts and determination to understand how criminal banking is harmful to individuals and nations. Reform is
possible but: it must be spearheaded by many; it must have the support of all political parties along with the
majority of the people ... and it must be very carefully planned and implemented.
Abraham Lincoln:
The money power preys on the nation in times of peace, and conspires against it in times of
adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than
bureaucracy. It denounces, as public enemies, all who question its methods or who throw light upon
its crimes.
Money is the creature of law, and the creation of the original issue of money should be maintained as
the exclusive monopoly of the national government. The monetary needs of increasing numbers of
people advancing towards higher standards of living can and should be met by the Government.
Government, possessing power to create and issue currency and credit as money, and enjoying the
right to withdraw both currency and credit from circulation by taxation and otherwise, need not and
should not, borrow capital at interest as the means of financing Government work and public
enterprise. The privilege of creating and issuing money is not only the prerogative of Government but
it is the Governments greatest creative opportunity. Thus money will cease to be master and become
the servant of humanity. Democracy will rise superior to the Money Power.
28

BankReformNow's Submission To Parliament

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BankReformNow's Submission To Parliament

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The impairment of customer loans

Bank Reform Now

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

Cases of Bank Engineered Defaults as told to Bank Reform Now

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

The impairment of customer loans

- (for a brief and powerful

The impairment of customer loans

The impairment of customer loans

The impairment of customer loans

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

The impairment of customer loans

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

Banks under fire over last-minute changes to mortgage payout notices

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

The impairment of customer loans

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

Previous Bank Reform Now submissions to government inquiries:

The impairment of customer loans

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

A EUROBODALLA doctors campaign against fraudulent and predatory lending practices by

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

The impairment of customer loans

The final word:

Bank Reform Now - Impairment of Customer Loans Inquiry 2015

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