The history of the banking Code and the problems that have beset it since its introduction are comprehensively outlined in two reports entitled ‘The Australian Bankers’ Problematic Code’ prepared by a Mr. Archer Field BEc, MBA.
The first report (Part 3b) dated 5th December 2010 was submitted to the Tasmanian Small Business Council and the second report (Part 2) dated 19th August 2015 was submitted to the Council of Small Business Organisations of Australia. These are the most comprehensive reports produced in relation to the banking code and are required reading for anyone that wants to fully understand how the banking code has now become a shield for rogue banks rather than a protection device for the banks’ customers.
Because these reports are quite extensive, I will only present here a brief commentary on some of the key points of these two reports in order that the reader can grasp their significance.
Roadmap to Deception – The evolution of the Code of Banking Practice, 1993 to 2015
The 1981 Australian Financial System Inquiry, titled the ‘Campbell Report’, found that the Australian government was inappropriately intervening in the financial services industry. The report recommended that the government pull back from intervention in the operation of financial markets, and that it should instead implement high prudential structural standards. This - the report found -would help create a competitive but stable financial system.
In particular, the Report found that the increasing range and complexity of financial products and growth of more aggressive selling practices required stronger and nationally uniform consumer protection mechanisms. The report emphasised the high cost to consumers of seeking redress for breaches of these protections, also recommended the creation of industry-based alternative dispute resolution schemes. The inquiry found that this would give financial institutions flexibility to operate in a free market whilst protecting individuals and small businesses.
The Martin Committee
The Campbell Report’s recommendations on consumer protections were not implemented and as the pace of banking deregulation increased in the following decade, customer allegations of abuse by financial institutions mounted. The Federal Government responded by commissioning the 1991 Martin Committee on Banking and Deregulation. In its report, “Pocket Full of Change”, the Martin Committee endorsed the findings of the Campbell Review and recommended the creation of “a code of banking practice, contractually enforceable by bank customers and subject to ongoing monitoring”.
The Committee also recognised that the cost of holding banks to account for breaches of consumer protections through the court system was prohibitive to bank customers. In response, the committee recommended the creation of alternative dispute resolution schemes that would enable bank customers to have their disputes arbitrated cheaply, quickly, and fairly outside the court system. The result was the creation of the 1993 Code of Banking Practice, (the Code), which came into effect in 1996 and has been subsequently revised three times, most recently in 2013.
The Code is described by the Australian Bankers’ Association (ABA) as the “banking industry’s customer charter on best banking practice standards”. The Code compels banks to create alternative dispute resolution schemes and all disputes, the Code outlines, are to be investigated.
The Code was purported to be based on a set of practices agree by banks, consumers, and government with the aim to as outlined in the Preamble to the Code - would:
“Promote good banking practice by formalising standards of disclosure and conduct which Banks that adopt the Code agree to observe when dealing with their customers”.
However, through amendments in 2003 and 2004, the Code has become a vehicle for deception, allowing the major banks to mislead their customers while claiming to protect consumer rights.
Viney Review 2000
In 1999, then-Minister for Financial Services and Regulation, Joe Hockey, commissioned the Treasury Taskforce on Industry Self-Regulation, to provide feedback to government on what constitutes ‘best practice’ in industry selfregulation.8 The taskforce analysed Codes of Conduct within various sectors, including the financial sector, with the intention of reducing regulatory burdens on businesses and thus ultimately improving market outcomes for consumers. The Taskforce criticised the Code of Banking Practice as lacking the necessary monitoring and enforcement mechanisms to ensure compliance.
As a result, in May 2000 the Australian Bankers’ Association (ABA) appointed Richard Viney to conduct an independent review of the Code. In conducting the process, Mr Viney sought submissions from governmental and industry bodies, as well as consumer representatives, on suggested changes to the Code, before making his final recommendations to the ABA. These recommendations – outlined in the Final Report, released in 2001 - resulted in the new Code being drafted and launched by the ABA in August 2003.
The code was revised in 2003, with David Bell—the CEO of the ABA— claiming that the ‘second generation code’ would be: “An effective demonstration to the Government that self-regulation works, and is a real alternative to the heavy hand of legislation”.
This revision introduced the Code Compliance Monitoring Committee (CCMC), which monitor the code compliance of subscribing banks. The ABA intended for the CCMC to have: “A very important role, especially when it comes to taking action against a bank... the code is contractually binding, so a regulator might even consider action of its own”.
The 2004 Code provided, in clause 34:
“That the CCMC’s functions will be:
To monitor our [the banks’] compliance under this Code;
To investigate, and to make a determination on, any allegation from any person that we have breached this Code…and
To monitor any other aspects of this Code that are referred to the CCMC by the ABA”.
The Code was again revised in 2013. The Code currently purports to provide the consumer with three regulatory services:
• a code compliance monitor;
• an internal dispute resolution mechanism;
• and an external dispute resolution mechanism.
A Binding Code
The General Standard Terms (Annexure B) - a part of standard banking contracts in Australia - sets out in clause 35:
“The relevant provisions of the Code of Banking Practice apply to this facility agreement if you are an individual or small business”.
Facility Agreement - another part of standard banking contracts - acknowledges that the Code is:
“A legally binding contract is created between you and us”.
The original 1993 version of the Code prescribed in clause 1.3 that:
“(banks) will be bound by this Code in respect of any Banking Service that Bank commences to provide to the Customer.”
This statement was replaced with a statement of the ‘voluntary’ nature of the Code in 2003.
However, ABA director, David Bell, clarified: “The code is a voluntary code in the sense that a bank has a choice whether to adopt it”… Once a bank has adopted the code, it binds the bank contractually to the customer. So if a bank breaches the code, it has breached its contract to the customer.”
Clause 3 of the 2003 Code itself confirms that this is so:
“If this Code imposes an obligation on us, in addition to obligations applying under a relevant law, we will also comply with this Code except where doing so would lead to a breach of a law.”
In interpreting the 2003 Code as a binding contract upon banks, ABA director David Bell cautioned:
“A bank must be sure it is ready to comply with its obligations under the revised code before it adopts it because the code is an enforceable contract between the bank and the customer”.
Indeed, although the National Australia Bank (NAB) has appealed this ruling, the Supreme Court of Victoria recently confirmed that the Code is a legally binding contract between banks and their customers in National Australia Bank Limited v Rice  VSC 10. While the Code has been accused of using ambiguous and misleading definitions of terms, obscuring the banks’ obligations under the Code, it appears clear that the Code is contractually binding between banks and their customers.
The Code Compliance Monitors: Toothless Tigers
In 1999, the Treasury-commissioned Self-Regulation Task Force found that the Code of Banking Practice lacked the monitoring and enforcement mechanisms that made give force to other industry Codes - such as those in the health and broadcasting sectors. This concern was further explored during submissions by both government and industry bodies to the Viney Review in 2000.
In its submission to the Viney Review, the Joint Consumer Submission suggested that an independent external body be tasked with undertaking compliance monitoring. ASIC stated in a similar vein that:
“This review should consider establishing an independent regime for investigating contraventions and imposing appropriate sanctions”.
The Australian Bankers’ Association expressed their preference for:
“An independent, well-resourced code-monitoring agency with a capacity to impose a range of effective sanctions for code breaches”.
The NSW Government agreed, submitting that:
“It is important that the monitoring and reporting on the Banking Code of Practice is carried out by an organisation with experience in consumer banking issues, and which is seen to be independent of the banks. ASIC is one such agency. Compliance with the Code should be able to be independently double-checked, and not rely entirely on the bank’s self-assessment”.
The Australian Consumers’ Association criticised the 1993 version of the Code, stating:
“The lack of sanctions in the Banking Code presents a fundamental weakness and raises doubts about the credibility of the Code for both industry participants and consumers. A range of sanctions, under pinned by regulatory mechanisms, is essential for Code credibility”.
The Code Compliance Monitoring Committee
In the face of this criticism, the CCMC was formed, appointed and funded by subscribing banks and the banking industry body, the Australian Bankers’ Association. The CCMC was intended to investigate and ‘name and shame’ banks that breached the Code. However, despite promises otherwise, the CCMC does not protect consumers as its ability to investigate and impose sanctions on banks for code breaches is severely limited
A Dismal Record
In 2012, The Australian reported that 2.5 million complaints had been made under the Code of Banking Practice between 2004 and 2012. Of these, only 200 complaints were fully investigated.
While it is unlikely that all 2.5 million complaints would have involved legitimate instances of bank breaches, a regulatory system that investigates such a minute fraction of complaints has clearly failed.
The CCMC, in its 2014 annual report, states that in the 2013-2014 financial year, the 18 banks that adopted the Code investigated 1,099,272 disputes, under their internal dispute resolution schemes. Of these disputes, the banks reported to have found that they had breached the Code only 5,762 times. This number was simply too low to warrant the view that the banking regulatory system in Australia adequately protects its customers.
The lack of protection afforded to small businesses and individuals can be further blamed on two main factors; firstly, bank customers are not adequately informed of their right to take complaints to the CCMC, and secondly, the constitution of the CCMC, hidden from the public, seriously restricts the cases which the CCMC can investigate.
An Unknown Monitor
The CCMC, in its 2014 Annual Report, stated:
“The small number of allegations received from consumers and small businesses for investigation each year remains a concern”.
Of the 1,093,510 disputes lodged with code-subscribing banks, only 42 were referred to the CCMC? The CCMC reports that there were only 4,854 visitors to its website in 2013-14. It is therefore clear that the CCMC and its compliance functions lack public awareness.
One of the major causes of this is that the Code does not require banks to inform customers of the CCMC’s existence, or of their right to lodge breaches of the Code and complaints with the CCMC. As a result, the major banks in Australia only publicise customers’ right to lodge complaints with the CCMC in an extremely minimal way. It is of no surprise, then, that the CCMC does not receive more complaints.
The ABA’s Wicked Constitution
Clause 34(b) (ii) of the Code notes that CCMC’s functions are:
“To investigate, and to make a determination on, any allegation from any person that we have breached this Code.
Although this clause seems to require the CCMC to investigate any and all allegations that a bank has breached the Code, the CCMC is also bound by a ‘wicked’ constitution placed upon it by the ABA in 2004.
This constitution was first made available to the public in July 2012, and then it was only to a group calling itself the JMA Parties. The constitution is still not readily provided to consumers.
Under it, the CCMC’s powers to investigate are seriously restricted.
Clause 8.1 of the Constitution restricts the CCMC from investigating a dispute, if: the CCMC is, or becomes, aware that the complaint: is being, or will be, heard…by another forum.
Thus, where a dispute is, or will be, heard in another ‘forum’, the CCMC no longer has the power -or the responsibility - to consider the complaint.
For the purposes of Clause 8.1, a ‘forum’ is classified as:
“Any court, tribunal, arbitrator, mediator, independent conciliation body, dispute resolution body, complaint resolution scheme (including, for the avoidance of doubt, the BFSO scheme) or statutory Ombudsman, in any jurisdiction.
This means, that where a bank chooses to escalate a complaint to another ‘forum’, the consumer is stripped of the right to have the matter referred to the CCMC. Further, as the constitution is not disclosed to the customer, they are stripped of this right without being informed that this is the case.
Complainants are not given any explanation as to why the CCMC will not investigate a complaint, other than that it has a ‘conflict of interest’.
Further restrictions placed on the CCMC by its constitution were highlighted in its submission to the independent review of the Code in 2007-08.
Specifically, the CCMC members revealed that its ability to “name and shame” banks who breach the Code is limited, since it must receive approval from the ABA Chair before making any public statements, other than in its annual report. The CCMC also noted it can only name banks which have repeatedly breached the Code and failed to rectify issues raised by the CCMC.
This significantly undermines the core role of the CCMC as envisioned by the Martin Review.
The CCMC has also questioned the authority the ABA Chair has over its funding, and the fact that - due to budget constraints - its annual reports have very limited circulation.
In its submission, the CCMC ultimately calls the ABA’s constitution “problematic” and the governance arrangements “inadequate”. However, following publication of the 2007-08 review these opinions outlined in its submission were not addressed, causing the three members of the CCMC to resign shortly after its release.
A Constitution Becomes a Mandate
In 2013, the ‘CCMC Mandate’ replaced the constitution. Unlike the constitution, the mandate has been made publically available. Little appears to have changed however, and the CCMC is still restricted in investigating complaints.
In fact, as outlined in the CCMC’s 2014 annual report, the mandate further restricts the CCMC by denying it the authority to investigate those complaints involving initial clauses of the Code.
The major Australian banks claim that they are bound by a ‘world class’ Code, monitored by the CCMC, supported by the Financial Ombudsman Service (FOS), and approved by ASIC. It is evident, however, that the Code of Banking Practices is unclear and ambiguous. The Code Compliance Monitoring Committee is unknown, unused, and ineffective, severely restricted by a hidden constitution and damningly criticised by its own staff.
The Financial Ombudsman Service Limited is an unaccountable, bank-reliant, private company that is limited by its Terms of Reference to the detriment of small businesses, farmers, and individual customers.
That ASIC has approved of this arrangement is indicative of the degree to which banking regulation in Australia is a bank-run affair. Banks set the rules of their own game and have the financial resources to outgun any legal efforts made by consumers to bring the banks to account for their abuse of power.
Both the Campbell Review and Martin Committee endorsed deregulation of financial markets on the precondition that consumer protections were put in place to protect individuals and small business.
The Martin Committee stated that government must ensure:
“Adequacy of redress available to [consumers] in cases of dispute with their bank”.
However, this has clearly not been the case.
As the now-Federal Attorney-General, the Hon. George Brandis MP, stated:
“Unless you are a millionaire or a pauper, the cost of going to court to protect your rights is beyond you… the costs of legal representation an court fees mean that ordinary Australians are forced either to abandon their legitimate claims or enter the minefield of self-representation.”
By limiting alternative dispute resolution mechanisms and the power of compliance monitors, the Australian banks have denied individuals, farmers, and small businesses necessary consumer protections. Banking regulation in Australia has failed, despite recommendations made in both the Campbell Review and Martin Committee. Both reviews endorsed stronger alternatives to court action for breaches of the Code. However, under the present self- regulation system, there is no alternative for the majority of bank customers than to go to court to bring banks to account.
Was the ‘fait accompli’ by the Australian Bankers’ Association unconscionable?
The Australian Bankers Association (ABA) (the Association) was incorporated ten months after the modified 2004 code was introduced. The ABA’s Board comprised the CEO‘s of subscribing banks who had a duty under the APRA Act to have the appropriate skills, experience and knowledge and to act with honesty and integrity, and to be fit and proper and have appropriate governance standards.
At the time, the banks’ CEO’s promoted the modified code as being a world-class, voluntary, self-regulated code of banking practice. According to the ABA, the code set high-standards of conduct for banks in their dealings with their individual and small business customers. The ABA was quick to emphasize that the role of the (CCMC) was provided for in the code.
The CCMC by the way stands for the Code Compliance Monitoring Committee (the Committee). It was meant to be the key body that implemented the codes application and rules. The code itself made provisions for an independent Code Compliance Monitoring Committee to investigate and monitor complaints about code breaches.
All the ABA members who subscribed to the code agreed that the Committee was empowered to conduct its own enquiries into a bank‘s compliance with the code. Any person could make a complaint to the Committee about a breach of the code.
The banks that adopted the modified 2004 code agreed to be monitored by the independent Committee. Their customers were assured by the banks’ CEO‘s and the ABA that the Committee has been set up as an independent body with consumer, small business and banking industry representatives.
The banks’ CEO‘s guaranteed the public that the modified 2004 code grants and confirms existing rights to customers including: disclosure of fees and charges as well as changes to terms, fees and charges; privacy and confidentiality; and complaints handling (emphasis added), among other things. In fact, the bank parties were at pains to promote a new modified contract bound by ethics, good faith, high-principles and honesty.
The ABA emphasized the fact that one of the most important commitments that banks undertook in adopting the modified code was to act fairly and reasonably towards customers in a consistent and ethical manner. Again, the ABA and the subscribing banks’ CEO‘s (the architects of the modified 2004 code) doubled their declarations to the further improved high-principles of the code and the Bankers’ good intentions.
The Banks’s Underhandedness.
The Richard Viney review provided the first sign of the Bankers imposing their conditions on the code. In his 2001 report, Viney describes a ‘banking service‘ to mean ‘any service‘’ provided by banks. The banks chose to ignore Viney‘s recommendations because it didn’t suit them to do so. Instead, they redefined ‘banking service‘ as a ‘financial service‘ or product in the 2003 code.
They did this deliberately so that the dispute resolution powers and duties in the code were limited to investigating complaints in relation to a ‘financial service or product’ only. The Banking and Financial Services Ombudsman who is also controlled by the banks did the same, effectively capping the banks external dispute service as well.
In clause 40 of the code, it states ‘dispute means a complaint in relation to a banking service’ thereby leading customers to believe a ‘dispute‘ covers all complaints the banks receive irrespective of what they are about and without any limitations being imposed on them. Until the banks had ruled otherwise, this was understood to be the case.
This shows the scorn bankers had for the 1991 legislators that intended banks to publish a code that set ‘standards of good banking practice for subscribing banks to follow’. The redrafted ‘dispute’ definition meant banks were only obliged to investigate a few of the 39 clauses and 250 code sub-clauses contained in the code. They had no intention of complying with clause 35.7 that allowed the ‘dispute resolution process to investigate all complaints‘. Nor did they intend observing clause 2.2 where it states that the banks should “act fairly and reasonably towards their customers in a consistent and ethical manner. Ethics, you see, does not relate to a ‘financial service or product‟.
Let’s look at another slice of inequality.
Banks and other financial institutions in Australia use non-monetary conditions of default to impair the loans of their customers, and the use of punitive clauses such as suspension clauses and offset clauses by these institutions;
The banks’ contracts allow them to use whatever resources they consider necessary to default a loan if, during the period of the loan, the bank makes a decision to withdraw credit. In the banks’ General Standard Terms under ‘Undertakings’ it states:
“We may obtain a valuation report of any secured property at any time. You must pay us all costs in connection with the valuation.
9. Values, Investigators and Consultants
9.1 We may obtain a valuation report of any secured property at any time. You must pay us all costs in connection with the valuation.
9.2 If we reasonably believe you are or may be in default or we
reasonably believe the circumstances exist which could lead to default, we may appoint a person to investigate whether this belief is accurate … You must pay us all costs in connection with the investigation.
9.3 Any valuer, investigator or consultant we use is an independent contractor and not an agent or employee. We aren’t responsible for any representation, action or in action by them.
9.4 Any report we obtain from the valuer, investigator or consultant is for our use only. You cannot sue us, the valuer, investigator or consultant if the report is wrong. You must obtain your own report if you wish to rely on it.
(a) Practices of banks and other financial institutions using a constructive default (security revaluation) process to impair loans, where constructive default/security revaluation means the engineering or the creation of an event of default whereby a financial institution deliberately reduces, through valuation, the value of securities held by that institution, thereby raising the loan-to-value ratio resulting in the loan being impaired.
The banks engineered an arrangement that allowed them to refer disputes of code breaches from the Code Compliance Monitoring Committee (CCMC) to courts. The subscribing banks’ access to resources provides them with a considerable advantage when disputes are heard in the courts.
(b) Role of property valuers in any constructive default (security revaluation) process;
The banks’ contracts allow them to use whatever resources they consider necessary to default a loan if, during the period of the loan, the bank makes a decision to withdraw credit.
(c) Practices of banks and other financial institutions in Australia using non-monetary conditions of default to impair the loans of their customers, and the use of punitive clauses such as suspension clauses and offset clauses by these institutions;
The Code provides an opportunity for banks to argue that many of its clauses are non-specific. However, as individuals and small businesses will appreciate, there are a number of relevant clauses. The difficulty that customers have experienced is that banks have concealed the constitution of the CCMC from their customers. In so doing the banks are in breach of contract.
(d) Role of insolvency practitioners as part of this process;
There is a wide held view that insolvency practitioners are agents of the banks, and are indemnified by the banks. As such, their instructions are generally those of the banks. The conduct and practices of insolvency practitioners was the subject of an earlier Senate Inquiry. There is no reason not to believe that while banks are self-regulated, so too are insolvency practitioners.
(e) Implications of relevant recommendations of the Financial System Inquiry, particularly recommendations 34 and 36 relating to non-monetary conditions of default and the external administration regime respectively;
This subject was previously discussed in a paper presented to TSBC. Small businesses, farmers and individual bank customers should be disappointed with the proposed amendments to unfair practices by Treasury that followed the Financial Systems Inquiry. There is no justification for any unfair practices in the banking sector. Legislators or regulators should accept responsibility for the lack of governance oversight in the banking and financial sector.
(f) Extent to which borrowers are given an opportunity to rectify any genuine default event and the time period typically provided for them to do so;
Bank customers are only provided an opportunity to rectify any genuine dispute in circumstances where the financier believes it is in the best interest of the bank. The decision by the bank or financial institution to foreclose on a small business, farmer or individual customer appears to be made by senior bankers attempting to reduce the bank’s exposure to unnecessary noise. In many cases it also appears that banks have made a decision to minimize their risk to classes of assets, especially agribusiness loans that have become less attractive as global markets change.
(g) provision of reasonable written notice to a borrower when a loan is required to be repaid;
Refer to the statement made in point (f) above.
(h) appropriateness of the loan to value ratio as a mechanism to default a loan during the period of the loan; and the decision by banks to rely on loan-to-value mechanisms is often generic and based on assets with a regional or industry risk rating. It is based on a number of factors such as a customer’s wealth, diversified assets and history with the bank. The loan-to-value ratio is a general banking decision that takes into account a customer’s financial standing. Once the bank has provided credit, the loan-to-value ratio is part of an overall assessment of the bank’s risk with each customer.
(i) Conditions and requirements to be met prior to the appointment of an external administrator;
refer to the statement made in point (h) above.
Comparisons between valuations and sale price.
The valuations relied on by a bank and its customer will vary considerably. In the event a bank forecloses on a loan, and sells assets, it generally does so in circumstances where the price obtained does not provide an opportunity for the customer to seek redress. In a recent Competition Policy Review paper, published in 2014, the bank sold a farming property in western NSW for $8.7 million. Recent documents have become available and note that the bank charged the customer penalties in excess of $3 million, which meant the customer had no funds to defend themselves in the court.
The adequacy of the legal obligations on lenders and external administrators (including s420A of the Corporations Act 2001) to obtain fair market value for the forced sale of property; and ost customers have limited funds to enforce their rights in the event that their business, farm or property is sold by the credit provider. This limits any access to justice and precludes them from taking further action to recover damages under s420A of the Corporations Act 2001.
One can see now how the banks’ use the code to their advantage because they hold all the cards.
Just to make certain though that they had all the bases covered, when the modified 2004 code (the code that was supposed to set so-called high-standards of conduct for banks) was introduced by the banks, it allowed for a constitution that was then used to impose restrictions on the newly appointed CCMC.
What this constitution did was to effectively circumvent the intentions and spirit of the modified code and shape it into a tool that the banks could use to reject many of the claims that they would receive. Rather than the code acting as a protective device for the banks’ clients, it became a means whereby the banks could put an end to annoying disputes whilst still sounding lawful in its approach. In fact, in law, it was anything but!
What the ABA effectively did was to hi-jack the code by establishing its own constitution that contained conditions favouring banks over their customers that were never contemplated when the modified code was formulated.
It seems incredible that the ABA could hijack the banking code simply by formulating a constitution of its own with conditions that were never agreed to by those that approved the modified bank code back in 2003. In one fell swoop, the bankers by so doing overturned the monitoring Committee‘s powers, independence and authority. This action by the banks highlights their attitude where integrity and ethics are concerned. They have none!
Why the ABA were allowed to introduce a constitution that tampered with the conditions of the code is a mystery. Why the Committee responsible for monitoring the code should be bound by the ABA’s constitution beats me also?
What were the government and ASIC doing whilst all this was going on?
Because the ABA had acted in this way, it mean that the banks’ customers could no longer rely on the Committee to effectively police any allegations of Banker misconduct because the code had been neutered. The Martin Committee‘s ambitions that ‘no-one-would be-taken-for-a-ride’ whilst the code was in place had become an unrealized aspiration.
The FEMAG Report (Foundation for Effective Markets and Governance) was the first to make public the issue of the Association‘s unpublished constitution. During 2004-05, the principles of the code and protection that it provided individuals and small businesses were such that conflict of interest and abuse of the system were not foreseen. The report however provided a small window into how the banks parties later used the constitution to restrict the independence of the Committee and the operation of the CCMC.
The FEMAG Report noted that the Association (ABA) was an unincorporated, unregistered entity. Because its constitution did not provide for a governing committee, the affairs of the Association were therefore governed by a general meetings of its members. These members consequently had an opportunity to exert influence over the appointment of the Committee members and the continuing activities of the CCMC. In general terms, the Committee were appointed by the Association‘s members and bank parties who could agree on the selection and continuing appointment of their preferred candidates.
The banks continued to sell the notion to their customers that they were bound by the banking code but they left out one very important point. The code they were working on was a watered down version of the one they were advertising as being the original. A bit like someone selling you a genuine painting that turns out to be a fake!
Of course, what the banks have done with the banking codes is unlawful. Why? Because the banks are telling their customers that they are contractually bound by a banking code with one set of conditions that everyone can view whilst they had another version in the cupboard with another set of conditions that favour them. By acting in this way the banks have been misleading and untruthful towards their customers since February 2004.
The Martin Committee’s time spent on assisting with the design of the original code in 1991, and the legislators’ time implementing its principles were all for nothing; rendered meaningless by predatory and dishonest Bankers.. No wonder the banks are making huge profits. They are doing so at the expense of the Australian people.
The banks’ reprehensible behavior since self-regulation is a testimony to the fact that they cannot be trusted to do the right thing. Therefore, the further away from the monitoring of the code and its administration the banks are kept, the better off are the banks’ customers.
FRANK AINSLIE – 15th February 2018
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I ACCUSE – (An exposé of Storm Financial and the banks that were involved in this banking scandal.) Available from amazon https://www.amazon.com/-/e/B0756S56YZ
The following are available at https://bankvictims.com.au/
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