Daniel Ziffer - A Wunch of Bankers: A Year in the Hayne Royal Commission

A WUNCH OF BANKERS

Daniel Ziffer covered the Hayne royal commission for ABC radio, TV, and online. He was formerly the longtime senior producer of Mornings with Jon Faine at ABC Radio Melbourne, and has worked on air and in production at Macquarie Radio, as a freelance foreign correspondent based in New York City, as a journalist at The Age , and as a magazine editor. He lives in Melbourne with his wife and two children.

To Asha, Lily, and Elliott

Scribe Publications
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First published by Scribe 2019

Copyright Daniel Ziffer 2019

All rights reserved. Without limiting the rights under copyright reserved above, no part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form or by any means (electronic, mechanical, photocopying, recording or otherwise) without the prior written permission of the publishers of this book.

9781925849363 (Australian edition)
9781912854653 (UK edition)
9781925693881 (e-book)

Catalogue records for this book are available from the National Library of Australia and the British Library

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Contents

PROLOGUE

Rien Low has been in the spotlight before. A TV producer, he was in a boyband and sang on televised talent shows for millions of people. Now hes just handsome, well dressed, and in the royal commissions witness box, desperately alone.

After his father, Peter, died in a 2015 industrial accident, Rien, his siblings, and his mother uncovered the breathtaking amount of credit hed been saddled with by Suncorp almost $1 million in five separate outstanding loans that had been extended to a 62-year-old blasting contractor, a sole operator with no staff and half a shed on a bush block that was to be his superannuation.

It was a second shock after the death. Rien gave his evidence slowly, thoughtfully. His fathers name is his middle name. Focused, despite his emotion, he had the tight jaw of someone who had not just tasted tragedy, but had it roll around in his mouth for a few years.

After he, his sister, and other relatives delved into the situation in the weeks after Peters death, Rien contacted Suncorp. You have to sell your mothers house was the extent of the conversation, he told the commission.

Without the fathers income, Riens mother, Jenny, a full-time housewife of 30 years experience, was to be $3,000 a month short on the payments. The family asked for a years pause on the repayments, so they could grieve and restructure their affairs.

Suncorp offered to defer the next four monthly payments, but noted that the repayment amounts could be recalculated increased to make up for the gap.

Rien tried to consolidate the five loans, which were accruing $1,200 interest each week. Knocked back there, and unable to refinance with other lenders, Rien examined the financial position of his fathers business at the time of being given the loans. With that, he contacted the Financial Ombudsman Service* with a complaint about Suncorps conduct in approving the loans in the first place.

[* Generally known as FOS, but confusingly pronounced Foz.]

The ombudsman found that the final of the five loans to the Low parents for $240,000 was irresponsible. Thats because one of the purposes of the loan was to fund construction of a factory on a block of land that the parents owed, when just a year earlier Suncorp had lent them $200,000 for the same purpose.

But it was a perverse win.

The ombudsmans determination meant that the bank couldnt charge interest on the irresponsible loan. The family wanted the existing payments $1,005 a month to go towards paying down the principal of the irresponsible loan.

The bank called that plan an interest-free loan spanning 17 years, and wouldnt do it.

So instead of letting Mrs Low make the existing payments (as it would have if her husband was alive), Suncorp now wanted the entire remainder of the irresponsible loan $221,000 cleared.

In just six months.

At this point in the timeline of bastardry, someone in the public gallery loud and audible in the quiet space said: SHIIIIIT!

Incredibly, the family got a letter from the CEO, David Carter, expressing a change of heart: Were writing to let you know the minimum repayment for your loan has decreased and the minimum repayment amounts will now be $792.53.

It was over. The four loans would be paid for by the sale of the house. The last one, even though it was irresponsibly lent, would be paid back in a way that wouldnt put the entire family in penury.

A Suncorp employee, Wendy Calcott, called. Rien told her theyd got the offer in the mail and were really happy and humbled that the amount had been lowered.

She had no idea what he was talking about.

The next day, Ms Calcott sent an email: she wanted to see the letter, because the CEOs office had confirmed they hadnt made any offer. Rien might be holding the piece of paper, but it never happened.

Behind the scenes, there was a desperate top-level search for the letter. CEO David Carter is emailed directly about it. ??????? one executive writes in their response. Sounding a little strange to me, says another.

One executive emails with his suspicions: This sounds like hes up to something.

Rien wasnt. He was just a grief-stricken son attempting to navigate a system that had already seen him deal with 1520 Suncorp staff over hundreds of hours, while holding down a full-time job, supporting his grieving mother, and grieving himself.

Rien made another complaint to the ombudsman. Suncorp told him the deal was off the table unless he withdrew the complaint. (The ombudsman came back with a preliminary view that Suncorp hadnt misled them with the phantom letter from the CEO).

The family accepted a deed to pay back the irresponsibly lent loan in five years. It was a better offer than six months. There was also a confidentiality clause that not only stopped them bad-mouthing the bank, but would kill off a mooted complaint about the broker who facilitated the loans.

Rien was struggling:

I mean, the impact it has had on Mum shes not here today, because the the pressure and the expectation it just everything the bank and obviously what has happened to my father, it has just its taken its toll on her, unfortunately. It has taken its toll on all of us. Its just very, very stressful and a lot of pressure, you know, just and trying to live a normal life and work full-time. It has it has just been very, very difficult.

Later, Suncorp executive David Carter would agree it wasnt good enough.

The loan was irresponsible, he concluded. Of course, that didnt stop the bank from vigorously fighting the ombudsman at every step. Suncorp even used the Google Earth satellite photo service to argue years after the loan was granted that the factory was 90 per cent completed.

When staff emailed each other, saying WTF is this son up to?, Carter agreed the language was inappropriate. But he disagreed that the sentiment behind the language was inappropriate, because the intent of the team involved was very good.

But before those mealy-mouthed responses, another injustice scratched the skin.

As Rien spoke, the Westpac team relaxed outside the courtroom after their witness had been excused on an unrelated earlier matter.

Their light, relieved laughter slid under the door of the court, which was silent but for Riens responses.

She wasnt really coping, Rien said, about his mother, as the peals pinged around the room. It was an unwitting response from outside but all it sounded like was mockery.