Financial institutions and banks in Australia are being driven by greed leading to misconduct and abuse, says a landmark inquiry. A 2018 royal commission has exposed all the wrongdoings in the industry. A report released on Friday said how the industry values profit more than it values people. The interim report was called a ‘scathing’ assessment by the Australian government. Josh Frydenberg, treasurer, said that people deserve better than they are receiving from the country’s financial sector.
Kenneth Hayne, the commissioner, said that numerous incidents of corporate misbehavior and customer exploitation had been heard. The 1000-pages-long report said that the main reason behind so much misdoing seems to be the desire for short-term profits at expenses of basic standards of honesty. The actions taken against the offenders by financial firms and banks were said to be inadequate with them either being nothing or barely anything at all.
The last 8 months have seen several interviews held by the inquiry of 100 or more witnesses in public hearings across Australia. More than 9,300 reports were submitted accusing insurance companies, banks, pension funds and financial advisers of alleged misconduct. Incidents of predatory practices and customer rip-offs including charging of fees to dead people by the leading bank of the country dominated headlines. Testimonies about corporate frauds, deceiving regulators, reckless practices and banks being bribed were heard. People were shocked and high-profile executives resigned. Tougher penalties like longer jail sentences were introduced by the Australian government.
The financial sector is Australia’s largest industry. After 10 years of such scandalous malpractices, the royal commission stepped in. All calls for the investigation were rejected by the government initially but it later admitted that the involvement of the royal commission might be ‘regrettable’ but it was ‘necessary’ for restoration of public trust in the system. Scott Morrison, Australian Prime Minister said that he is open to the idea of extending the year-long inquiry. The publication of the final report by the commission is due in the month of February 2019.