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Money $500 billion pool of 'liar loans' in royal commission's sights

13:26  13 march  2018
13:26  13 march  2018 Source:   msn.com

NAB board aware of alleged fraud ring for months: commission told

  NAB board aware of alleged fraud ring for months: commission told The banking royal commission has heard more sensational details of NAB's home loan 'introducer' program.The National Australia Bank board was made aware of an alleged fraud ring operating within the bank in western Sydney months before the bank reported it to the corporate watchdog, the banking royal commission has heard.

Australia' s $ 500 billion pool of home loans potentially underpinned by fake customer information – so-called liar loans – will be front and centre as the banking royal commission begins this week.

Australia' s $ 500 billion pool of home loans potentially underpinned by fake customer information – so-called liar loans – will be front and centre as the banking royal commission begins this week.

The NAB bank logo is seen on a branch in Sydney.© AAP Image/Mick Tsikas The NAB bank logo is seen on a branch in Sydney.

Australia's $500 billion pool of home loans potentially underpinned by fake customer information – so-called liar loans – will be front and centre as the banking royal commission begins this week.

Witnesses from National Australia Bank and Commonwealth Bank of Australia and its wholly owned Aussie Home Loans division will be hauled before the royal commission to answer questions about the sale of mortgages by in-house and external home loan brokers.

Late on Monday, the commission revealed three witnesses will be called to give evidence on Tuesday including two senior NAB executives, executive general manager consumer loans Angus Gilfillan and Anthony Waldron, the bank's executive general manager growth partnerships – an area of the bank that takes care of broker relationships.

The woman asking the hard questions at the banking royal commission

  The woman asking the hard questions at the banking royal commission Silk Rowena Orr was once a junior barrister learning from Kenneth Hayne's wife Michelle Gordon. Now she is assisting him with a landmark inquiry."The terms of reference ... are broad and the time to report is short," Orr told Hayne in Melbourne. "We embrace the challenge involved in assisting you.

Broker raking in big commissions for issuing home loans to people who might not be able to afford it will be under scrutiny.

$ 500 billion pool of ' liar loans ' in royal commission ' s sights Sydney Morning Herald 12 March 2018. Australia's $ 500 billion pool of home loans potentially underpinned by fake customer information – so-called liar loans – will be front and centre as the banking royal commission begins

Karen Cox, the coordinator of advocacy group Financial Rights Legal Centre, will also be called to give evidence at the royal commission on Tuesday.

The industry has been racked by scandals in recent years after it emerged brokers have been driving up their sales of home loans by using applications that included either fake payslips or other fake information to get their clients loans.

“Liar loans” have emerged as a serious issue in the Australian banking industry with around a third of people admitting in a survey they had not been accurate about their financial position when applying for a mortgage. According to an estimate respected banking analyst Jon Mott from UBS that equates one third - or $500 billion - of Australia’s $1.5 trillion residential mortgage book.

Big bank home loans complicated, not competitive: ACCC

  Big bank home loans complicated, not competitive: ACCC The big banks' home loans are opaque, not competitive, and 'no frills' mortgages do not necessarily mean cheap, according to the Australian Competition and Consumer Commission. The ACCC's interim report from its Residential Mortgage Inquiry puts the banks under even more pressure as they struggle to defend questionable lending practices being uncovered at the banking royal commission.

Broker raking in big commissions for issuing home loans to people who might not be able to afford it will be under scrutiny.Witnesses from National Australia Bank and Commonwealth Bank of Australia and its wholly owned Aussie Home Loans division will be hauled before the royal commission to

Denise Brailey @DeniseBrailey. All loans ROBO approved on automated banking systems. Millions dollars paid in commission for fraudulently doctored loans . The Sydney Morning HeraldVerified account @smh. $ 500 billion pool of ' liar loans ' in royal commission ' s sights http

One of the first topics on Commissioner Kenneth Hayne’s list this week will be the examination of NAB's program of paying "introducers" - people outside the bank who collect a fee for referring a customer.

Australian inquiry hears CBA knew risks but put mortgage 'volume' ahead of customers

  Australian inquiry hears CBA knew risks but put mortgage 'volume' ahead of customers <p>Commonwealth Bank Chief Executive Ian Narev knew that a system of financial incentives to reward mortgage brokers could hurt customers but failed to act, an inquiry into Australia's financial sector heard on Thursday</p>A confidential letter penned by Narev in 2017 and disclosed on the third day of the financial sector Royal Commission criticised the practice of paying brokers more for bigger loans, an incentive still widely in place including at CBA.

$ 500 billion pool of ' liar loans ' in royal commission ' s sightshttps://www.smh.com.au/business/banking-and-finance/ 500 - billion - pool - of - liar - loans - in - royal - commission - s - sights -20180312-p4z40k.html …

$ 500 billion pool of ' liar loans ' in royal commission ' s sights . The Sydney Morning Herald 12d. Diving Into Pool Corporation's Growth, Leadership, and Valuation.

NAB revealed in late 2017 that it had sacked 20 employees and disciplined a further 32 staff for breaching its lending policies when issuing 2300 home loans to mostly foreign buyers of Australian property.

Sources said the bank had put in a range of changes to improve its handling and processing of home loans.

It’s not the first time NAB has run into issues with dubious home loans.

In 2007, the NAB sued one of its former staff members and an external home loan broker for allegedly fraudulently borrowing $22.7 million from the bank so that hundreds of people could obtain permanent residency and home loans.

That same eternal home loan broker was later linked to an $170 million alleged home loan fraud in 2015 where a team of external brokers drew up more than 600 home loans using doctored payslips through 12 different banks including CBA and NAB.

CBA mobile lender Andrew Cameron was charged last year over his alleged involvement in the fraud.

In 2016, two other mobile lenders employed by the CBA were implicated in an alleged $76 million fraud by two Melbourne commercial property developers.

However, it is believed the $170 million alleged fraud, thought to be Australia’s largest ever home loan fraud, will not be canvassed by the royal commission as Mr Cameron is still before the courts.

The commission will also look at "fraudulent brokers" within CBA-owned Aussie Home Loans, after the corporate watchdog banned several Aussie brokers in recent years for submitting false or misleading documents.

Again, in some instances this included falsified payslips that indicated the borrower had a large income than they actually did. Some of those applications were for loans from outside the CBA, including loans from ANZ, NAB and Westpac.

'Don’t do this to me I have kids' - Nalini's highway to financial hell .
Westpac's Bank of Melbourne gave this single mother-of-two a loan that would put her into severe financial hardship.The tyre well of her old, banged up Mitsubishi Magna had recently caught on fire with her young sons in the back, giving them all a terrible fright.

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