On September 28, Commissioner Hayne released his Interim Report on Misconduct in the Banking, Superannuation and Financial Services Industry. Pages 19 to 72 are dedicated to Consumer Lending and the conduct of participants.
In his report, Commissioner Hayne is clearly unimpressed with the attitudes of the Big 4 banks. On several occasions, he points to a lack of co-operation and a culture of profit above all else. It would appear that the banks have been dragged to the commission room kicking-and-screaming and whilst they initially were not as transparent as the Commissioner would have liked; they have clearly changed their tact of late.
The final report, due in February next year, will be very interesting and we will wait to see whether the strong words included in this report are backed up by tough penalties and tangible actions for improvement from the Banks.
Finance Brokers are not excused from criticism in this report either. On several occasions, Commissioner Hayne raises a query as to who the Broker truly represents and whether this is as transparent to the customer as it should be. Is it the customer or the lender? A conclusion to this question is yet to be reached, but it remains a focus of the Commissioner and broker disclosures will almost certainly be further reinforced next year.
At SalesKey, we obviously have a keen interest in Section 7 of the Interim Report which focuses on Regulatory Compliance. Commissioner Hayne specifies a number of compliance-related “issues”. Two are very pertinent to you:
- What duties does an intermediary owe to a borrower? and;
- What duties should an intermediary owe to a borrower?
If these questions are not ones you’ve seriously considered before, we recommend you start doing so now! We also suggest that you set aside some time to discuss with your team. Yes, clearer expectations of Brokers will likely be defined post-February 2019; however, it’s your personal response that will likely separate you from your competitors now!
Going above & beyond for clients is what SalesKey is particularly passionate about. We also believe that strong processes and a customer-focused compliance regime is the key to success in today’s competitive landscape…hence our name!
Don’t be afraid of what’s coming but instead, get ahead of the game now!
Of course, we’re here to discuss this topic and any others you’re interested in. Please call us on 1800 954 488 or via email at firstname.lastname@example.org.