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TOPIC: Fos lent on by which bank?

Fos lent on by which bank? 5 years 2 weeks ago #1846

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  • Karma: 0 (and the Green and 2GB) are right onto the revolving doors. Have any FOS eople gone on to join CrikeyBank in the consumer dept? I dunno, that spy scandal won't go away and the spies aren't as good as the yanks.

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Fos lent on by which bank? 3 years 10 months ago #2985

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Michael McGarvie admitted that Howard Bowles and Clare Marshall spoke about Vice President Biden and the Amex Antitrust Case right after Judge Garaufis confirmed the Reserve Bank Data confirmed the Judge's decision to Sink Amex. Right after Wildfang, McCaffrey, Friedman and Ravelo found out the same things that the Legal Services Board in Australia knew about cocaine and criminal scam document scanning companies that passed info to Ravelo from Friedman. McGarvie's admission is dated 4th Augusst 2015 and its not "Privileged" and its with the Prosecution Team. 4th August was the same day too the CUNA told the Court that the RBA was wrong and "Choice Magazine" was right too. Someone should sue McGarvie for "spying" on politicians and cases with fairytale Pretenses.

Tis the link to the Texan Submission on August 4th 2015.

Howard Bowles was happy when Herrera sued Amex.

Btw, who told Sgargetta the legal board wanted to get back at Gadens and the Banks??? Sgargetta says he will sue the legal board for $4m, his accountant wants $2m and Supportives and Maverick's members want at least $100,000 each for Breaches of the Privilege by Howard to that boiler room scammer in Brighton, Trevor McTaggart.

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Fos lent on by which bank? 3 years 9 months ago #3027

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Derryn Hinch's Justice Party nd Dr Prigeon think there's pedos in the law. Dr Michael McGarvie is out hunting the anti-pedos with a vengeance.
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Fos lent on by which bank? 2 years 2 weeks ago #3647

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FOS and ASIC should be quizzed about this -

Mar 23 2018 at 8:00 PM
Updated Mar 23 2018 at 8:00 PM

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Banking royal commission: Home loan industry seems set for a shake-up

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Commissioner Kenneth Hayne invited banks and mortgage brokers to address the fundamental question of "who does a ...
Commissioner Kenneth Hayne invited banks and mortgage brokers to address the fundamental question of "who does a mortgage broker act for?" Royal Commission
Karen Maley AFR Woodcut

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by Karen Maley

The important thing in any dramatic performance is to make the final scene as rousing as possible, allowing the audience to experience a powerful catharsis. Rowena Orr, QC, the senior counsel assisting the Hayne royal commission, didn't disappoint.

Bankers in the audience would have felt decidedly queasy as Ms Orr ran through the long litany of serious breaches that had potentially been committed by the banks and mortgage brokers.

As she proceeded through the various case studies of banking misbehaviour, striking patterns began to take shape.

There were numerous instances where banks had breached their statutory obligations under the National Consumer Credit Protection Act and under the Corporations Act to provide financial services "efficiently, honestly and fairly", and to ensure that customers were not disadvantaged by conflicts of interest that arise in the provision of financial services.

Bankers had also flouted prohibitions in the National Credit Act by making loans without making reasonable inquiries about the customer's financial circumstances, or without taking reasonable steps to verify the customer's financial situation.

Ms Orr also raised extremely serious questions about the way banks reward both staff and mortgage brokers. Bank staff frequently receive incentive payments based on the volume of products they sell, which means that they focus more on flogging loan products than on ensuring that the bank meets its own responsible lending obligations.
Convincing arguments

In contrast, mortgage brokers receive upfront fees and trailing commissions, based on the size and the duration of the loan.

As the Commonwealth Bank's chief executive Ian Narev noted in a confidential letter to the Sedgwick commission last year, these "can potentially lead to poor customer outcomes" because mortgage brokers would receive higher payments if customers took out larger loans over longer periods. Even worse, customers are largely kept in the dark about the amount of commission their home loan broker is pocketing.

It will take considerable skill on the part of the banks' highly paid legal representatives to find convincing arguments to mitigate the serious charges levelled against their clients.

And it will sorely test their powers of persuasion to convince Commissioner Hayne that there's no need to recommend sweeping changes to the country's massive home loan industry, which has evolved to the point where mortgage brokers originate more than half of all loans.

Ms Orr has invited the banks to submit written submissions addressing the tricky question of whether the present arrangement of paying upfront and trailing commissions to brokers leads to poor customer outcomes, and whether it should be replaced by a new arrangement where brokers would only receive a flat upfront fee.

She also asked them to consider the question of whether there was a general commercial impediment that had prevented the banks from changing the way mortgage brokers are remunerated, and, if that was the case, "what can and should be done to overcome that"

They could also submit arguments as to why banks should continue to lean heavily on the conservative "Household Expenditure Measure" (HEM) benchmark for assessing customers' living expenses, and therefore their ability to service large loans.
Greater concern

"By and large customers are poor historians when it comes to identifying their outgoings," Commissioner Hayne noted on Friday. And he signalled that he was interested in the question of whether the banks should continue to focus on the gap between borrowers' monthly income and their monthly expenses to determine whether they can afford to service a home loan.

But of far greater concern to his audience, Commissioner Hayne also demonstrated an interest in delving deeper into the vexed issue of mortgage brokers' conflicts of interest.

He invited banks and mortgage brokers to address the more fundamental question of "who does a mortgage broker act for?"

This question, he said, could be teased out further. There was the issue of who customers believed the mortgage broker was acting for, as well as the issue of who the banks thought the broker was acting on behalf of.

It was even possible, he surmised, that the answer would vary depending on the different stage in the home loan process. "Are there varied answers at various steps, and if there are, what are they?", he wanted to know.
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Fos lent on by which bank? 1 year 6 months ago #4042

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Banking royal commission hears how CommInsure misled the financial ombudsman
By business reporter Michael Janda
Related Story: Insurance telemarketers told to 'sell, sell, sell to get to Bali'
Related Story: Freedom Insurance cold caller targeted man with Down Syndrome
Related Story: Insurer ClearView admits to breaking law with more than 300,000 sales calls

The Commonwealth Bank's life insurance arm, CommInsure, is accused of "serious misconduct" at the royal commission because it misled the Financial Ombudsman Service during its investigation of a customer complaint.

The commission also heard about aggressive retention practices at Freedom Insurance that prevented the vast majority of customer who called up to cancel policies from doing so.

Read the blog to see how the day unfolded.

Note: This is a blog. Posts are organised by date with the newest posts at the top.

Commission will continue with CommInsure tomorrow

Ms Troup gets a break overnight but will be back in the stand tomorrow at 9:45am (AEST).

Today we learnt that CommInsure deliberately left its heart attack definition out of date so that it could refuse claims and thereby increase its profits.

We also learnt that CommInsure misled the Financial Ombudsman Service (FOS) in its response to a complaint from a heart attack victim who had been denied a full payout.

Earlier in the day, we heard how Freedom Insurance used commissions and targets to motivate an aggressive retention team that made it difficult to cancel unwanted insurance policies.

Wed at 4:30pm (Updated: Wed at 4:52pm)
Hayne humour resurfaces

Michael Janda Wed at 4:30pm (Updated: Wed at 4:52pm)
Wed at 4:28pm (Updated: Wed at 4:28pm)
CMLA motivated by commercial considerations

Ms Troup acknowledges that CMLA's (CommInsure's life insurance division) heart attack definition was left out of date for commercial considerations.

Instead of changing the definition of heart attack it changed the wording of its policies so that they only covered heart attacks of a particular severity, one that met the out of date definitions.

Michael Janda Wed at 4:28pm (Updated: Wed at 4:28pm)
Wed at 4:02pm (Updated: Wed at 4:02pm)
CommInsure's heart attack definition hopelessly out of date

The commission hears that an international group of cardiologists issued an updated universal definition of heart attack in 2007, which noted advances in the sensitivity of measuring equipment meant that a troponin test set at the 99th percentile of a normal reference population was the appropriate standard.

This was the standard that CommInsure eventually adopted in March 2016 — after the Four Corner-Fairfax reports.

There was another update from the international cardiologist group in 2012 that confirmed this definition and said it also should be gender differentiated.

Ms Troup accepts that within CommInsure it was known from at least early 2012 that CommInsure’s definition of heart attack didn’t reflect the universal definition of heart attack.

There was a proposal within CommInsure in September 2011 to update the definition of heart attack in the next product development cycle.

That proposal was not adopted. When asked why, Ms Troup says the decision why not was “not well documented”, although she mentions that pricing may have been one of the factors.

Michael Janda Wed at 4:02pm (Updated: Wed at 4:02pm)
Wed at 3:42pm (Updated: Wed at 3:42pm)
Troup 'happy' with ASIC report

Ms Orr reads out an email from CBA's Clive van Horen (who has appeared in an earlier hearing of the royal commission) that congratulates Ms Troup on the findings of the ASIC report into CommInsure's claims handling, which found no breaches of the law. Ms Troup acknowledges she was happy with the findings.

Orr: "What were you happy about with those findings?"

Troup: "There were some extremely serious allegations made against CommInsure on the Four Corners program and they were found to be unsubstantiated and that was a very good outcome for CommInsure."

Ms Orr points out that, while ASIC found no legal breaches, it did find serious problems with aspects of CommInsure's claims handling.

Michael Janda Wed at 3:42pm (Updated: Wed at 3:42pm)
Wed at 3:37pm (Updated: Wed at 3:47pm)
More appropriate to backdate definitions to 2012

The actual cost of backdating to May 2014 was only $2.5 million. CommInsure had budget up to $22 million for the cost of backdating the definitions to apply from May 2014.

"And was that one of the reasons why CommInsure was able to decide so quickly, after receiving ASIC's final letter, to backdate the definition further to October 2012?"


Ms Troup and CBA's then head of wealth Annabel Spring decided to backdate the definition further to October 2012.

When asked if she thought that was a more appropriate date to backdate to, Ms Troup said "yes".

Conveniently, the decision to backdate further to October 2012 was conveyed to ASIC the day before it was putting out a media release on the topic.

Ms Troup is later asked whether it would have been more appropriate to update the heart attack definitions back in 2012 and she says "yes".

Michael Janda Wed at 3:37pm (Updated: Wed at 3:47pm)
Wed at 3:16pm (Updated: Wed at 3:16pm)
Commission sceptic converted

Stockbroker and ABC regular Marcus Padley told News Breakfast this morning that he originally thought the financial services royal commission would be a politically-driven waste of time.

But he's now changed his mind.

"The sooner changes happen the better, and ASIC need to pull their finger out as well because they are obviously underfunded.

"And you know, for ClearView, they gave them a slap on the wrists … they didn't punish them.

"It's got to change. This industry has being rooting us for years."

'They've been rooting us for years': Is this the definitive take on the banking royal commission?

Michael Janda Wed at 3:16pm (Updated: Wed at 3:16pm)
Wed at 3:06pm (Updated: Wed at 3:06pm)
ASIC report into CommInsure

The commission is now questioning Ms Troup about ASIC's review of CommInsure's claims handling processes.

The ASIC report concluded the CommInsure had not breached the law, but there were "a number of areas of concern" that the regulator expected to be fixed.

This was the ABC's reporting at the time.

ASIC's CommInsure report finds no breaches of the law

Whistleblower's lawyer slams ASIC's report on CommInsure

Michael Janda Wed at 3:06pm (Updated: Wed at 3:06pm)
Wed at 3:02pm (Updated: Wed at 3:02pm)
ASIC found CommInsure 'likely to mislead' FOS

The ASIC review of the complaint forwarded by FOS found that CommInsure's interactions with FOS were likely to mislead and in fact did mislead FOS.

When asked what action ASIC took, it emerges that the regulator basically told CommInsure not to do it again and to implement changes to ensure it didn't happen again.

Michael Janda Wed at 3:02pm (Updated: Wed at 3:02pm)
Wed at 2:47pm (Updated: Wed at 2:50pm)
FOS accused CommInsure of 'serious misconduct'

The commission hears that CommInsure withheld information from the Financial Ombudsman Service (FOS) delaying the dispute resolution process and potentially prejudicing the outcome for the complainant.

FOS formed the view that CommInsure's actions may amount to "serious misconduct".

However, CommInsure disputed the conclusion that it had engaged in serious misconduct or attempted to deliberately mislead FOS.

FOS described CommInsure's response as "not persuasive" and reported the matter to ASIC for further investigation.

Michael Janda Wed at 2:47pm (Updated: Wed at 2:50pm)
Wed at 2:25pm (Updated: Wed at 2:55pm)
CommInsure misled FOS

The commission hears that CommInsure misled the Financial Ombudsman Service into thinking that it had not assessed the claimant against the new heart attack criteria.

This occurred through the redaction of part of a document sent to FOS by the group customer relations officer plus a sentence in CommInsure's response stating that the company did not want to do a new assessment, implying that one had not already been done.

CommInsure did in fact have a medical opinion that found the insured did meet the updated heart attack definition.

Ms Troup says this was an unacceptable response by CommInsure.

Michael Janda Wed at 2:25pm (Updated: Wed at 2:55pm)
Wed at 1:10pm (Updated: Wed at 1:10pm)
Commission breaks for lunch

The commission is breaking for lunch a little later than the usual 1:00pm (AEST), so Commissioner Hayne is sneaking in a few extra minutes of break, with the hearing set to resume at 2:15pm (AEST).

In the meantime, have a listen to Peter Ryan's excellent summary of the morning's key points on The World Today.

LISTEN: "Bloody whinger" - Freedom Insurance staffer derides Down Syndrome man trying to cancel policy

Michael Janda Wed at 1:10pm (Updated: Wed at 1:10pm)
Wed at 12:58pm (Updated: Wed at 12:58pm)
Custom claim denied despite updated definitions

While CommInsure updated its heart attack definitions, it continued to reject the claim from the case study currently being examined by the commission.

That is because the claim was made in January 2014, months before the backdating applied to the updated definitions.

Michael Janda Wed at 12:58pm (Updated: Wed at 12:58pm)
Wed at 12:48pm (Updated: Wed at 12:48pm)
CBA expedited updated heart attack definitions

The commission hears that CommInsure responded to the media reports on its outdated heart attack definitions by bringing forward an update that was due to be completed by October 2016.

This update was brought forward to March 10 and backdated to apply to claims made after May 11, 2014, the last time the bank had updated its product disclosure statement.

Michael Janda Wed at 12:48pm (Updated: Wed at 12:48pm)
Wed at 12:39pm (Updated: Wed at 12:39pm)
Claims approval process and definition of heart attack

The royal commission is examining Ms Troup about CommInsure's claims approval process and definitions of a heart attack.

Ms Orr asks what the relationship was between case managers and CommInsure's medical team.

Ms Troup says the two were independent groups, and the case manager had the final say based on advice from the doctors.

We are hearing about one specific case of a claimant who claimed on their trauma insurance due to a heart attack.

However, CommInsure's doctor gave a medical opinion that the claimant didn't meet the criteria for a heart attack, which centred on the levels of certain enzymes and ECG readings that indicate a heart attack has taken place.

CommInsure paid a partial benefit because he met the definition for another heart condition.

Michael Janda Wed at 12:39pm (Updated: Wed at 12:39pm)
Wed at 12:20pm (Updated: Wed at 12:20pm)
CMLA (CommInsure) witness takes the stand

We're now hearing from Helen Troup, who is the managing director of CommInsure and has been since April 2014 and is giving evidence about CMLA (the Colonial Mutual Life Assurance Society Ltd) — the company responsible for life insurance.

Helen Troup, managing director of CommInsure

Both life and general insurance are issued under the CommInsure brand.

In 2017, CBA sold its life insurance business to AIA, but the transaction hasn't completed yet, so CMLA is still within CommInsure.

Michael Janda Wed at 12:20pm (Updated: Wed at 12:20pm)
Wed at 11:45am (Updated: Wed at 11:45am)
Claims handling in life insurance

We are about to hear from CommInsure's managing director Helen Troup, which looks set to focus on the company's claims handling process and denied claims.

Ms Troup's LinkedIn profile says she has been in charge at CommInsure since April 2014.

The Four Corners-Fairfax investigation into CommInsure and its denial of payouts was one of the key factors behind the push for a royal commission.

CommInsure tried to avoid payouts to dying: whistleblower
ASIC found no evidence that CommInsure broke the law, in a review completed early last year. Let's see if the royal commission agrees.

ASIC's CommInsure report finds no breaches of the law
The Commonwealth Bank has since sold off CommInsure, although the company's products are still sold by the bank under a 20-year partnership agreement.

CBA sells CommInsure Life for $3.8b, considers $4b Colonial sell-off

Michael Janda Wed at 11:45am (Updated: Wed at 11:45am)
Wed at 11:27am (Updated: Wed at 11:27am)
Orr reads summary of insurer statements

Senior counsel assisting the commission Rowena Orr is currently reading out a lengthy list of insurer statement summaries.

These statements analyse what accidental death policies are offered in the market, how many policies were sold, how many claims were made and what proportion were denied.

Basically it highlights how few successful accidental death claims are made. Some companies did not have a single successful claim.

By far the most common reason for denial was that the death was not accidental. This obviously depends considerably on the definition of an accidental death.

Michael Janda Wed at 11:27am (Updated: Wed at 11:27am)
Wed at 11:07am (Updated: Wed at 11:07am)
Freedom is expanding rapidly

The banking royal commission hears that Freedom Insurance is expanding rapidly.

While it has a very small share of the insurance market for existing policies, the commission hears it is getting about 10-12 per cent of new policies.

Freedom is acquiring St Andrews insurance, which featured in an earlier commission hearing about the mis-selling of funeral insurance to Indigenous communities by Select.

Media releases from Freedom say the takeover will "assist it to diversify its products".

Mr Orton says St Andrews is strong in the loan protection insurance area — that is insurance to cover loan repayments in the event of unemployment, illness, etc, depending on the terms of the policy.

Michael Janda Wed at 11:07am (Updated: Wed at 11:07am)
Wed at 10:37am (Updated: Wed at 2:37pm)
Sales agent's 'sad face' on Stewart case

The royal commission is hearing evidence about the internal communications between sales agents in response to Mr Stewart's complaints about his son, who has Down syndrome, being sold a policy over the phone that he he didn't understand.

Mr Stewart rang to complain about the policy sold to his son and to have it cancelled.

One of the communications between two sales agents featured 25 sad face emoticons about the Stewart case after the other agent denied a request by Mr Stewart's father.

Mr Stewart was described as a "bloody whinger" by another staff member in an instant messenger chat.

"His son sounds not normal tho. strange. But the dad sounds like he's gonna take it further."

"I don't know what he expects to get out of it lol."

Mr Orton expressed his disgust with the staff response.

“That sort of behaviour - it was a young company at the time - was totally inappropriate.”

When Mr Stewart rang back again in a second attempt to cancel his son's policy, his call was forwarded to the retention unit, which, as we have heard, is incentivised to "save" policies from cancellation.

Michael Janda Wed at 10:37am (Updated: Wed at 2:37pm)
Wed at 10:26am (Updated: Wed at 10:26am)
Retention staff judged on keeping people in policies

The commission hears that one of the key performance indicators (KPIs) for retention staff is a "save percentage" — that is the proportion of customers they persuade not to cancel their policies.

Orr: “It’s the primary KPI?”

Orton: “I would say so yes.”

The commission hears that these retention agents receive a base salary plus commission.

Mr Orton says only 20-30 per cent of the retention staff currently receive a commission, but these payments can be substantial.

“Some of them earn decent commissions probably similar to the sales agents if not higher.”

The company says it will be removing commission payments for these staff.

Michael Janda Wed at 10:26am (Updated: Wed at 10:26am)
Wed at 10:12am (Updated: Wed at 10:31am)
'Not taking no for an answer'

Mr Orton said he listened to 400 sales and retention calls after taking on the role as Freedom chief operating officer, as part of a review requested by the corporate regulator ASIC.

Mr Orton says many of these calls were retention calls and he found the standard of conversations unacceptable in many cases.

“It needed a lot of work ... in some instances it was far too difficult for customers to cancel."

“Not taking no for an answer on certain calls … that is something I will not allow to happen in the future.”

Ms Orr points out that some customers have reported to ASIC or written on public forums that they were hung up on while attempting to cancel a policy. Mr Orton says he is aware that some customers have reported difficulties.

"I'm not aware of customers being hung up on ... I am aware of some wait times."

Michael Janda Wed at 10:12am (Updated: Wed at 10:31am)
Wed at 10:06am (Updated: Wed at 10:06am)
Most policyholders talked out of cancelling

Freedom Insurance received 37,500 calls to cancel policies — 75 per cent of policyholders told the company they either didn't want or couldn't afford the cover.

However, only 8,118 callers, or 28.5 per cent, successfully cancelled their policy during the call.

In contrast, 12,720 callers (44.7 per cent) were persuaded to retain their policies without change and a further 7,598 (26.7 per cent) resulted in retention with alterations.

Michael Janda Wed at 10:06am (Updated: Wed at 10:06am)
Wed at 9:55am (Updated: Wed at 9:58am)
Freedom retention strategy in the
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