This week, Jacqueline McDowall became the human face of the malpractice of Australia’s financial services industry, as she tearfully recounted the woeful advice she was given by Westpac that cost her her house, and most of her superannuation.
The nurse and her husband hoped to buy and run a bed and breakfast, so she could retire from her job. Advised by Westpac financial planner Krish Mahadevan – who called himself “the money man” – to sell the family home and invest in a self-managed super fund, she was then told she could not borrow the money she needed.
“I said, ‘We sold our family home on your advice. We now don’t have a family home to live in’,” she told the commission through tears. “I was too embarrassed to tell anybody. I felt humiliated, stupid.”
McDowall and her husband are still renting, and fear they will never be able to buy a home. She said she could probably have to keep working “until I’m 80”.
McDowall has followed other customers of Australia’s financial services industry into the royal commission – people such as David Harris, who repeatedly pleaded with Commonwealth Bank not to increase his credit limit because he was struggling to control his gambling addiction.
Despite his plea, the offers of more and more credit came, until he was in debt to the tune of tens of thousands of dollars.
“I explained I’m a gambler, I have a gambling problem, they can clearly see that I’ve got a gambling problem because of the transactions I’ve been making, and I don’t understand why they keep offering me more money,” he said.
The litany goes on: NAB staff accepted envelopes stuffed with cash to wave through loans they knew were based on fake documents in order to “smash targets” and score bonuses. Commonwealth Bank employees charged clients who were dead for a decade, for services they never provided, not even when they were alive, conceding they were the “gold medallists” of “fee-for-no-service” banking. And AMP executives have admitted lying to the corporate regulator Asic in an attempt to cover up their behaviour of charging for no service.
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