Dear Mr Shorten,
My wife and I applaud your aim of bringing the Banks under control. We have shares or investments in the Banks, but we do not enjoy Bank policies which exploit people who are poorer and more vulnerable than we are. Banks are greedy, most of their customers are too, and the Directors and top executives are the greediest of the lot. I lost over $50,000 as a result of the way CBA subsidiaries (Commonwealth Financial Planning and Colonial First State) dealt with a pension fund I had with them.
I should love to give evidence about it to a Royal Commission, if there were one, but I do not believe that is the right way for you to proceed. All you need to do, when you are the government, is to legislate. You should pass legislation making it a criminal offence for a Bank to commit any of the types of actions which have been the subject of the scandals which have rocked small people for the last decade or more. You know what they are, and it is not beyond the wit of as clever a man as Mark Dreyfus, and a lady like Penny Wong, to draft the clauses which will have the desired result.
However, you need to go further. You need to make it an offence to be a director of a Bank which indulges in such conduct, and it needs to be an absolute offence, like Drink Driving. The punishment should be imprisonment and the forfeiture of their earnings for the year in which they are charged. It is only when the Boards feel the pain personally that they will stop inflicting it on little people and little businesses.
We try hard to be ethical investors. We don’t like companies which squeeze staff levels at the risk of employee health and safety for the sake of bigger dividends. Only stringent legislation will help secure the necessary change of attitude. A Royal Commission will take years and achieve nothing. The history of Commissions, to help resolve the problems of race and the ill-treatment of indigenous peoples in this country, shows just how useless these Inquiries are. They look like a good idea, but they are just a sop to the public, whilst politicians keep on taking big jobs with big companies and organisations, which are left untouched.
(We’d welcome any other readers’ views or banking experiences good or bad. Ed.)