Some interesting data if you run a business – 150 seconds.
Some interesting data if you run a business – 150 seconds.
This is a great article on how to increase your personal productivity.
Fraudsters are impersonating both the ATO and tax agents in an attempt to scam funds from taxpayers.
Business Katarina Taurian 07 September 2018
Often using the threat of outstanding debt, these fraudsters initiate a fake three-way conversation with themselves, a taxpayer and someone impersonating a tax agent.
The tax office is warning taxpayers to be aware of this new scam, as members of the community have reported several attempts at fraud of this nature.
Scammers will also often tell a taxpayer a complaint has been made against them, that their arrest is imminent if they don’t pay a tax debt, or that a tax refund will be issued in exchange for bank account details.
Earlier this year, the ATO issued similar warnings over a myGov scam, after fraudulent emails promising taxpayers a tax refund were issued en masse, in an attempt to steal personal and financial information.
As always, the tax office is reminding the tax profession of the need to be vigilant as the regulators usually see a spike in scam activity at tax time.
The banking and finance system must serve the interests of the people and the country. Currently this is not the case in Australia …. and much of the world. Please sign the petition to change this.
From the CEC:
There is a case to be made that Australia’s bank regulator has colluded with the banks to hide massive fraud in mortgage lending. The Australian Prudential Regulation Authority’s (APRA) collusion includes suppressing its own research into lowered lending standards, and misleading Parliament about its knowledge of illegal misconduct by banks in mortgage lending.
In a 1 March 2018 hearing of the Senate Economics Committee, Greens Senator Lee Rhiannon questioned APRA chairman Wayne Byres on his knowledge of mortgage control fraud. The hearing was 11 days before the start of the first round of hearings of the Financial Services Royal Commission, which the issue of mortgage control fraud would dominate. Perhaps unaware of how much the royal commission knew, Byres responded to Rhiannon’s questions with APRA’s trademark obfuscation and deflection. Documents subsequently released by the royal commission, however, show that Byres lied.
Rhiannon asked Byres, “In relation to your investigation into mortgage fraud, which APRA has not made public, has APRA found any evidence of illegal misconduct in the mortgage market by the major lenders?”
Byres ignored the point of the question and instead denied that APRA was looking into mortgage fraud. “I wouldn’t say what we’ve done is specifically a review of mortgage fraud”, he said, adding that they have looked “generally” at lending practices and controls. He then claimed that APRA had not found evidence of illegal misconduct.
With this reply, Byres misled the Senate. APRA was investigating mortgage fraud. The proof is revealed in documents made public by the royal commission on 23 March, which included reports to the major banks by accounting giant PricewaterhouseCoopers, of targeted reviews PwC had conducted in 2017 into the banks’ mortgage lending controls. As PwC’s reports made clear, APRA had ordered the reviews.
In PwC’s May 2017 report to Westpac entitled “APRA Targeted Review of data used in residential mortgage serviceability assessments”, PwC states explicitly in the Executive Summary that APRA had ordered the reviews due to concerns about mortgage control fraud. “On 12 October 2016, APRA issued a letter to the Bank and 4 other large banks requesting that they undertake a Review into the risks of potential misrepresentation of mortgage borrower financial information used in loan serviceability assessments”, PwC noted. “In its letter, APRA referenced assertions made by commentators that ‘fraud and manipulation of ADI residential mortgage origination practices are relatively commonplace’.” (Emphasis in original.)
This proves that APRA clearly ordered the banks to conduct targeted reviews of mortgage fraud. Yet the royal commission is unlikely to have had this evidence, had it been up to APRA. Later in her questioning, Lee Rhiannon asked Byres if APRA should be proactive in providing information to the royal commission, but Byres replied, “We’ll wait and see what the royal commission asks.” His extraordinary excuse was he didn’t want to “swamp them with things that are not relevant to them”. Byres’ idea of what’s “not relevant” appears to have included PwC’s reports.
A few days before Byres’ testimony, Lindsay David of LF Economics had tipped off the royal commission about the targeted reviews. This was around two weeks before the royal commission’s first round of hearings, which were on mortgage lending. LF Economics specialises in forensic analysis of misconduct within the mortgage market, and has probed into the details of many of the numerous cases of mortgage fraud that the Banking and Finance Consumer Support Association’s (BFCSA) Denise Brailey, the leading expert on mortgage fraud in Australia, has exposed through her tireless advocacy for bank victims. (CEC Research Director Robert Barwick interviewed Denise Brailey for the 22 and 28 March 2018 episodes of the CEC Report, available on YouTube channel CEC Australia.)
According to David, LF Economics first became aware of the targeted reviews in mid-2017, but had been informed that they were “so unfavourable they would never see the light of day”, he recalled. At the time he was consulted by the royal commission staff, they were unaware of the existence of the targeted reviews—indicating that APRA had not revealed them. It was David’s tip-off that led the royal commission to request copies from the banks, and make them public on its website.
So why would Byres go out of his way to deflect the attention of the Senate committee away from the fact that APRA was looking into mortgage fraud? And why would APRA not share this with the royal commission? It goes to the collusive relationship APRA has with the big banks, which former ANZ director John Dahlsen denounced in the 21 August Australian Financial Review as “incestuous”. APRA is notoriously secretive, with the power to suppress information through strict secrecy restrictions. It has a track record of using its secrecy to cover up risks and fraud in the banking system. Due to its excessive secrecy, APRA is effectively unaccountable, which breeds the arrogance on display in committee hearings.
APRA is complicit in the banks’ reckless lending, which has created a dangerous housing and debt bubble that threatens the Australian economy. It allowed the banks to lower their lending standards in the early 2000s, to be able to massively expand their lending to homebuyers and investors who, like the US “sub-prime” borrowers whose defaults sparked the 2008 global financial crisis, couldn’t afford normal loans. In March 2007, APRA suppressed an explosive internal report which warned that the lowering of lending standards had led to the banks lending 3.5 times more credit for mortgages than would have been the case under the previous, higher standards. And APRA repeatedly lowered the so-called “risk-weighting” of mortgage loans to make them far more profitable than any other lending, and to fake the appearance that banks were raising their capital to the “unquestionably strong” levels of 14.5 per cent, whereas real bank capital stayed at less than six per cent.
In short, APRA incentivised the excessive mortgage lending that motivated the banks to resort to fraud. It’s a fair bet that Byres hoped to keep APRA’s awareness of the problem under wraps, to protect the illusion that it is a “sound” prudential regulator. He wasn’t banking on the royal commission process, however, which has destroyed this illusion and opened the possibility of fundamental reform of the banks and regulators.
Join the fight to break up the banks and reform APRA!
The mortgage fraud by the banks that APRA has covered up massively expanded Australia’s housing and debt bubble. Now the borrowers who couldn’t afford their mortgage in the first place are threatened by rising interest rates, which will trigger increasing defaults and ultimately crash the bubble—and the banks. The CEC’s Banking System Reform (Separation of Banks) Bill 2018, which Bob Katter MP introduced in Parliament on 25 June, will break up the banks, by separating the commercial banks with deposits from all other financial activities, and bring APRA under strict Parliamentary control. This will enable the government to implement measures that clean up retail banks used by the public in a way that stops them from crashing, and stops APRA from using its “bail-in” powers to steal our savings to prop them up.
Contact your MP today to demand they debate Bob Katter’s bill! The government wants to shelve it, so we must force them to debate it, which will force all MPs to either support it, or justify why they won’t—and in light of the revelations from the royal commission, which have led to many calls to break up the banks, that will be very hard.
I had someone request I add a link to their site to an archived TLAT newsletter. I looked at it and the statistics on their site are worth passing on.
The former director of ANZ Bank and chairman of Woolworths John Dahlsen has intervened in the banking turmoil in Australia to denounce the Australian Prudential Regulation Authority (APRA) and call for structural separation of the banks “following the principle of the US Glass-Steagall Act”.
Mr Dahlsen expressed his views in a column in the 21 August Australian Financial Review, “APRA’s incestuous rule comes at too high a price”, which is an edited version of an article he has written for the IPA Review, the publication of free market think tank the Institute of Public Affairs, of which he was formerly on the board.
“APRA is among the least accountable federal agencies”, the former chair of the ANZ Bank board’s audit and risk committee wrote of the bank supervisor.
“There is an incestuous relationship between APRA and the banks. There is no separation of influence and nearly all senior staff are ex-bankers, so you are unlikely to get any independent and innovative thought.”
Mr Dahlsen is a longstanding critic of APRA’s risk models and risk-weighting of lending, which has incentivised the banks to concentrate their lending on mortgages at the expense of the rest of the economy. Mortgages account for more than 60 per cent of the lending of each of Australia’s Big Four banks—a far greater concentration on mortgages than any other banks in the world—which has inflated a world record housing bubble that will inevitably crash the banks and the economy when it bursts.
“APRA’s use of the secrecy provisions in its governing legislation prevents an informed market, and it uses this massive information imbalance to maintain the fictions that risk is a science, that everything is quantifiable and that all material required by APRA is intelligently reviewed”, he explained.
“It is simply not possible for APRA to intelligently review the vast amount of data it demands from the banks. The risk-based models used by banks and regulators must be externally reviewed as a matter of urgency.” (Emphasis added.)
After calling for a revised mandate for APRA to reform its function and effectiveness, Mr Dahlsen turned to a more fundamental and far-reaching reform—structural separation.
He wrote: “Problems in banking will not be solved until the structure is changed, which means more than merely reshuffling responsibilities around the existing club of regulatory institutions.”
The experienced banker is convinced that a Glass-Steagall separation would be beneficial to shareholders, and therefore advocates for banks to do it voluntarily. He acknowledged, however, the political momentum in Australia for legislation to forcibly break up the banks, which some banks would require. “With barriers removed it is possible that banks and the investment market will move to unlock shareholder value in structural separation, following the principle of the US Glass-Steagall Act, which kept commercial and retail banking separate”, he wrote.
“Voluntary demergers would threaten the gravy train of ‘coupon clipping’ for fee extraction, but enforced separation in Australia seems inevitable, and the mere threat of it could prompt demergers.
“The alternative of further complex regulation is frightening. Complex regulation (such as Dodd-Frank) never works because of the extreme difficulty of interpretation and enforcement. Simple regulation is simply better.”
(Dodd-Frank is the 848-page US banking legislation that Barack Obama enacted in 2010 after the global financial crisis, instead of restoring the simple Glass-Steagall separation, a 37-page law, which had protected Americans from systemic banking crises for almost 70 years, but which his Wall Street sponsors such as Goldman Sachs desperately opposed.)
John Dahlsen has added his voice to the chorus of calls for a full structural separation of Australia’s banks. The Citizens Electoral Council has led a campaign for Glass-Steagall in Australia since 2009. The late former prime minister Malcolm Fraser called for Glass-Steagall in a submission to the 2014 Financial System Inquiry. Leading National Party politicians Senator John Williams, and the Member for New England Barnaby Joyce, responded to the April hearings of the banking royal commission by calling for the banks to be broken up. On 25 June 2018 the Member for Kennedy Bob Katter moved, and the Member for Denison Andrew Wilkie seconded, the introduction into Parliament of the Banking System Reform (Separation of Banks) Bill 2018, which is based on the US Glass-Steagall Act. The Greens have long said they opposed the vertical integration that the royal commission has shown enables the banks to fleece and gouge their customers, and on 9 August they detailed a policy for a full, Glass-Steagall-style structural separation of the banks. The former Australian Competition and Consumer Commission (ACCC) chairman Allan Fels endorsed the Greens’ policy, emphasising the importance of ending both vertical integration and so-called horizontal integration which enables the government’s guarantee of deposits to flow through to risky investment banking and trading activities.
Liberal-National Coalition politicians especially should take note of Mr Dahlsen’s views, which contradict their government’s reasons for opposing Glass-Steagall. The Treasury has claimed that “Australia’s banks already exhibit a high degree of structural separation”, while the Member for Goldstein, Tim Wilson, a former policy director at the IPA, repeats to constituents that he won’t support the Separation of Banks bill because “Mr Katter’s legislation is designed for American conditions, not Australian conditions.”
Now an experienced Australian banker, who shares the Coalition’s and Tim Wilson’s preference for free market policies, has identified a structural separation of the banks based on the Glass-Steagall Act as precisely what is needed to solve the undeniable problems in Australia’s banking system.
Will the government pay attention? Will they respond to the truth being exposed at the royal commission, and the wise advice of John Dahlsen, or will they, as they did for years leading up to the royal commission, continue to protect the conflicts of interest, dangerous speculation, and outright criminality in Australia’s banks?
Join the campaign to pass banking separation!
Forward this release to your local MP and as many Senators as you can. (You can find the Senators from your state by clicking on this link, and clicking on your state under the heading State/Territory on the right-hand side.)
Include a message, or call their offices, asking for confirmation that they received the email, and for a written response.
Share this message widely on email and social media.
Prominence-interpretation theory helps determine what shapes users’ perceptions of a web site’s credibility.
This is unconstitutional. Magna Carta specifically prohibited this form of governmental tyranny and it is the base of our legal system.
Malcolm Turnbull is proposing laws which would allow the government to take assets where the owner hasn’t been charged with a criminal offence, let alone convicted of one. This is unconstitutional. Magna Carta specifically prohibited this form of governmental tyranny and it is the base of our legal system.
The Australian Greens on 8 August announced their policy for a full separation of Australia’s too-big-to-fail banks. The Greens have long expressed support for ending vertical integration in banking; their announcement clarifies that their policy is for the complete, Glass-Steagall-style separation of traditional commercial banking from all other financial activities that Bob Katter MP introduced legislation for on 25 June, the Banking System Reform (Separation of Banks) Bill 2018.
“The Greens are sick and tired of regulators fiddling around the edges”, Greens leader Senator Richard Di Natale and financial spokesman Senator Peter Whish-Wilson announced via email. “They’ve been doing it for decades. That’s why we’re announcing today that the first step to fix the big banks is to break them up.”
The Greens plan goes slightly further than Bob Katter’s bill, in that it requires all financial institutions to operate in only one of four areas:
Deposit and loans, including savings accounts, credit cards, mortgages and business lending
Large-scale superannuation funds, including default funds and choice funds
Insurance, including life insurance and general product insurance
Complex financial products used for investment banking, hedge funds, self-managed super funds, financial markets, auditing and liquidation
Bob Katter’s Separation of Banks bill separates the first category, which is traditional banking, from the other three. The Greens would also require any non-bank institutions to do business in only one of the other three categories. While the separation of the first category of traditional banking is the most important, the Greens’ policy would end many of the conflicts of interest that riddle Australia’s vertically-integrated financial system.
The Greens also plan to strip powers from the current, failed regulators: “The second part of our plan ensures customer safety, by handing over regulation of the sector to the ACCC [Australian Competition and Consumer Commission]. The current regulators, ASIC [Australian Securities and Investments Commission] and APRA [Australian Prudential Regulation Authority], have shown over and over again that they are more interested in keeping the big banks happy than protecting customers. This sector needs a powerful regulator who stands up for us.”
The Greens’ announcement immediately boosted the debate about bank separation, which has been raging globally for years, but for which the Citizens Electoral Council has been a lone voice in Australia until the past 12 months. Around the world, many experts are firm advocates of Glass-Steagall, including Bank of England chief economist Andy Haldane, former UK Chancellor of the Exchequer Lord Nigel Lawson, US Federal Deposit Insurance Corporation vice chairman Thomas Hoenig, and former Citigroup chiefs Sanford Weill and John Reed. Following the announcement from the Greens, Australian experts spoke up in support.
In The Australian on 9 August, Adam Creighton quoted former ACCC chairman Allan Fels’s endorsement of full separation. Professor Fels reiterated his April 2018 call for an end to vertical integration: “There are a number of serious structural issues that need to be considered, the first and most obvious is the separation of the activity of creating financial products and then offering so-called independent advisory services to customers on what are the best products,” he said. The experienced regulator also addressed the need to end so-called horizontal integration, by which risky trading activities get subsidised by bank deposits: “A second very important one is whether there should be a structural separation between traditional banking activities and the more risky investment activities. … Banks benefit from the implicit guarantee on their deposit liabilities which flows into their trading activities.”
Fels acknowledged the arguments that customers should be more careful and that more competition was needed in the banking system. “But what can’t be ignored is [the] deep structural conflict of interest between profit maximising activities and the need to provide essential services”, he said. “Some aspects of banking are comparable to a utility, everyone needs banking services to be available, to that extent it’s an essential service.”
The 8 August Guardian reported other expert endorsements: “The former ASIC chief economist Alex Erskine described the package as ‘comprehensive’ and said it ‘directly addresses several of the failures inherent in the existing regulatory architecture’ revealed by the banking royal commission.
“Andy Schmulow, a financial regulation expert at the University of Western Australia, said the policy was ‘far-reaching’. ‘But I cannot see lesser responses breaking the cycle of misconduct-cum-consumer abuse followed by apologies and undertakings to put things right, followed by further instances of misconduct,’ he said.”
The Citizens Electoral Council had criticised Greens Senator Peter Whish-Wilson for his statement in the Senate on 14 February that “I do trust the regulators—people like APRA, the Reserve Bank and ASIC”. Whish-Wilson was justifying the Greens’ support for the APRA crisis resolution “bail-in” bill that the government pushed through the Senate without a formal vote and with just eight Senators present, which the CEC had warned opened a back door for APRA to bail in deposits in order to prop up failing banks in a future financial crisis (similar legislation in India has just been withdrawn due to the concern about deposits).
Senator Whish-Wilson’s declaration of trust preceded the hearings of the banking royal commission, however. With his announcement of the policy for complete bank separation, it seems Senator Whish-Wilson has lost his faith in APRA. “Our regulation of the financial services and of the big banks has failed,” Mr Whish-Wilson said in a press conference. “There’s been a lot of evidence that our regulators both across ASIC and APRA have been captured.”
The CEC welcomes the Greens’ policy of full bank separation. As yet, the Greens have not indicated any plans for legislation, but there is already legislation to achieve full separation, which is Bob Katter’s private member’s bill. That Bob Katter, the CEC and the Greens can agree on full bank separation is illustrative of the bipartisan nature of the support for Glass-Steagall around the world, which spans the entire political spectrum, from “left” to “right”. Bob Katter greeted the Greens’ announcement with this wry 9 August Facebook post: “Normally I like my greens with a T-bone steak but it’s good to see them and former ACCC Chair, Allan Fels backing policy for full bank separation.”
<a href=”https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r6136″ target=”_blank”> https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r6136</a>