You’d be entitled to think, after the banking royal commission’s exposure of banks and AMP charging dead people fees, that our banking oligopoly would ensure it never happened again — if only from a public relations perspective. Nothing so sums up the image of bank bastardry as that of hugely profitable financial institutions robbing the dead.
Of course, you’d be wrong. ANZ — which managed to get through the Hayne royal commission relatively unscathed — was yesterday outed by the banking oligopoly’s own industry “regulator”, the Banking Code Compliance Committee (BCCC), for charging fees of dead customers. ANZ wasn’t the only bank doing it, either, but the BCCC chose not to name the other perpetrator — apparently naming banks who rob dead people is the most serious sanction it has.
But as always with banks, wait, there’s more. Not only did ANZ charge dead people fees between July 2019 (five months after the banking royal commission ended) and September 2023, but according to the BCCC, ANZ failed to respond to instructions or requests for information from representatives of deceased estates within the 14 day timeframe laid down in the banking code.
And then ANZ took its sweet time doing anything about the problem. “Despite first identifying the issues in early 2022, ANZ took over a year to implement solutions and then nearly two years to start its customer remediation program, which is still ongoing and expected to be finalised by the end of July 2024,” the BCCC said. That’s five years after it first started robbing dead people.
What an utter disgrace. Was ANZ paying any attention during Hayne? Does it just not care? Or is the cost of having systems that don’t rob dead people going to take too much off the bank’s bottom line — a profit of $7.4 billion for 2023?
While the banks’ own internal regulator was discovering that the likes of ANZ have learnt nothing from the Hayne royal commission, the federal government was approving ANZ’s takeover of Suncorp’s banking arm — a decision by Treasurer Jim Chalmers that defies the opposition of the Australian Competition and Consumer Commission.
The ANZ revelation is perfectly timed to show Chalmers’ decision is every bit as rotten as the banking culture he’s rewarding. ANZ buying Suncorp’s banks is a classic case of lazy Australian capitalism. Our major markets are dominated by oligopolies or monopolists that consume competitors and prefer extracting regulatory favours over innovation — and ANZ has done both with Chalmers’ half-arsed protections for bank jobs (as always, Labor looking after union members) for three years and a demand that the bank “enter into an agreement with Google for ANZ and Google to work with Queensland universities on curriculum initiatives”.
Seriously. You want a curriculum initiative, treasurer? How about Economics I and the benefits of competition?
While Chalmers was preparing that nonsense, the banking industry’s own internal regulator was working out that “the significance of the deficiencies in ANZ’s compliance frameworks was deeply concerning”. Did Treasury or Chalmers’ office actually contact the BCCC in the lead-up to his decision to check if there were any significant regulatory issues with ANZ? What about ASIC or APRA — the two financial regulators found by Hayne to be not just asleep at the wheel but downright comatose? Were they aware that at least two banks have yet again been searching the pockets of dead people?
It pays to remember what Kenneth Hayne said about incentivising misconduct.
“Rewarding misconduct is wrong. Yet incentive, bonus and commission schemes throughout the financial services industry have measured sales and profit, but not compliance with the law and proper standards. Incentives have been offered, and rewards have been paid, regardless of whether the sale was made, or profit derived, in accordance with law. Rewards have been paid regardless of whether the person rewarded should have done what they did.”
That’s exactly what Chalmers is doing by ticking off on ANZ expanding the big four banks’ oligopoly.
Federal Labor likes to talk the talk on competition, and has given the impression it’s actually prepared to take on what is the most serious systemic flaw in the Australian economy — our lack of competition and lack of proper competition regulation. It boasted of setting up a special competition unit within Treasury and is considering overhauling competition laws.
But when it comes to walking the walk, what’s Labor’s record? It helped Qantas preserve the airline’s gouging near-monopoly. It’s handed over $400 million to a Labor-connected US quantum computing firm without bothering to check what local firms could do. Prime Minister Albanese attacks break-up powers for the supermarket oligopoly — now embraced by the Coalition, thus isolating Labor — as some sort of Stalinist outrage. And it has waved through ANZ’s acquisition of Suncorp’s banking arm.
Maybe we can’t expect banks to refrain from sickening stuff like robbing dead people. Turns out we were foolish in thinking this government might do anything serious about competition, either.
