Broker groups' misconduct revealed

by Rebecca Pike09 Nov 2018

A brokerage has responded after the Royal Commission released original submissions from financial groups which shed light on misconduct across the industry.

While most, if not all, broker groups detailed incidents of falsifying documents and fraud, it has been revealed some of the behaviour at Aussie Home Loans included sexual harassment, offensive behaviour and homophobia.

The group has said it will continue to support reporting of such unacceptable behaviour as it to enforces a zero-tolerance policy.

When the Royal Commission into banking misconduct was first established, Commissioner Kenneth Hayne asked financial entities to provide information on misconduct or conduct falling below community standards over the last ten years.

While the incidents listed in the reports were to be the basis for many of the hearings during the Royal Commission, these 215 newly released documents from 94 groups paint a much broader picture.

Looking exclusively at submissions from broker groups, misconduct was listed alongside any action taken and subsequent outcome.

AFG submitted 12 items detailing incidents, which included brokers providing false documents, making administrative errors, breaching the privacy of clients, failing to comply with NCCP obligations and creating false approval letters.

Loan Market also made a submission which detailed 33 incidents of misconduct. Incidents included creating false documents, tampering with documentation, inappropriate use of social media, overstated consumer income and copying and pasting signatures.

Mortgage Choice has listed ten incidents including more than one case of falsifying signatures, providing false loan approval letters, misstating customer financial positions and falsifying documents. The broker group also listed three cases of failing to produce a Statement of Advice to customers.

Smartline listed incidents of altered valuation reports, failure to make reasonable enquiries about a customer’s financial circumstances and inaccurate information on loan applications.

The mortgage group also included an incident where a borrower’s credit card was allegedly fraudulently obtained and used, which at the time of submission was subject to a NSW police investigation.

It also detailed an “isolated incident” relating to theft from a customer and ended with the broker’s licence being revoked and the sale of their franchise.

Yellow Brick Road’s submission also included details of fraud and false documents. In one case a Vow Financial broker was accused of fraudulently gaining access to customer bank accounts and transferring funds.

Commonwealth Bank’s submission included details of behaviour at Aussie Home Loans. It includes details of “offensive or otherwise unprofessional behaviour” directed at employees and/or brokers.

Out of 182 total incidents, there were 29 listed as misconduct relating to false documents and/or declarations and/or misleading information.

There were 19 incidents listed in relation to NCCP breaches, including lack of reasonable care, failing to make the right enquiries and encouraging customers not to disclose the purpose of the loan.

The remaining incidents included, but were not limited, to:

  • Sexual harassment at a work event, and sexual harassment outside of work
  • Using Aussie's IT system to send “emails containing objection material which could cause offense to a reasonable adult”
  • Accessing customer’s personal details
  • Numerous counts of unprofessional language and tone
  • Pretending to be the customer
  • Mutiple examples of ex-brokers using confidential information to contact former customers
  • Disclosing customer details to other parties
  • “Unprofessional conduct by making veiled threats to customer's solicitor and allegedly impersonated someone else”
  • Customers experiencing homophobia
  • Derogatory and discriminatory comments
  • Alleged abuse of female in car park by a retail store broker and issue disclosed on Facebook
  • Attending a licenced venue "on a regular basis" and returning to work visibly drunk
  • Gaining access to an Aussie office after a work event, theft and assault
  • Inappropriate sexual language with fellow employee
  • Bullying by senior executives

A spokesperson from Aussie Home Loans said, “Media reports of submissions to the Royal Commission cited isolated incidents of unacceptable conduct involving staff and contractors over a ten year period.

“Aussie provided the Royal Commission a detailed and exhaustive table of incidents as a result of building a culture of actively encouraging and facilitating staff, contractors and customers to speak up and report unacceptable conduct.

“In each and every case of unacceptable conduct, Aussie took appropriate and swift disciplinary action, which included termination of employment and contractor agreements.

“Aussie will continue to actively encourage reporting of unacceptable conduct, to enforce its zero-tolerance policy for such conduct and to enhance its systems and process to prevent, detect and deter such conduct.”

COMMENTS

  • by Marty McD 9/11/2018 10:18:43 AM

    Quality group ?!?!

  • by Best Broker 9/11/2018 12:14:35 PM

    Why on earth are you publishing this!!! I thought you were meant to be a publication FOR brokers - supporting us, not damning us!

  • by Human Nature 12/11/2018 6:48:48 PM

    Does anyone question the character of the individuals who committed the offense?
    No matter how many policies and procedures, checking and auditing, people who have a poor character will still find a way to take a shortcut.