AN article in Queensland Country Life reported that Bankwest had called in receivers on the properties owned by Richmond Mayor John Wharton. He is not alone so much so that I have formed a class action group over of Bankwest's actions since they were bought out by CBA.
The outcome is many hard working Australian families and businesses have lost everything because of the corporate greed of CBA and the need to be seen to be doing the right thing by the Government. I would put losses by these families and business at over half a billion dollars.
We believe there have been backroom deals done between the Government and the CBA on this. The huge winners have been CBA and the receivers who feed off the carcasses of the Australian families and businesses that CBA/Bankwest has put to the sword.
In 2009, I was involved in a property that Bankwest sent receivers into. We were not behind in payments and we still have over half of our construction funding available to continue. They gave us 24 hours to pay back $6 million odd dollars; no reason, just give us our money back.
I placed ads in the Financial Review seeking aggrieved clients for a class action against CBA and Bankwest. I received over 100 calls in the first two days and over 180 to date.
Since CBA took over Bankwest all hell had broken loose. People who had never had an issue with their loans all of a sudden had the bank calling them in. What had changed?
In 2008 Bankwest was in trouble as its parent HBOS was broke, and CBA was asked to put together a rescue package by the treasure Wayne Swan (and Rudd) to buy Bankwest from HBOS.
Special deals were done to accommodate this by the Government and this opportunity was not afforded to any other banks at the time, though a few others could have afforded it.
ACCC signed off amazingly quickly. Graham Samuel has said since that he felt "pressured" to sign off the acquisition. Some believe this whole purchase was illegal under the Corporations Act.
The deal was done so quickly that CBA (supposedly) said it did not have time to do the proper due diligence on the commercial loan book of Bankwest so they put a clause in the sales agreement (which we want to get our hands on).
The provision stated there would be a "clawback" on the original consideration paid for Bankwest by CBA if any of the loans were deemed by CBA to be "bad' or "doubtful".
This meant CBA had an opportunity to assess their own book and write off what they wanted and this would be paid back to them by Lloyds. Nice.
Around this time many Bankwest customers who had never had a problem with their loans in paying them back or drawing down funds pretty much immediately started to have some trouble with their facilities.
CBA pretty much put a halt to all loans, drawdowns, extensions, approvals after their acquisition. This meant people who were just finishing their developments could not complete and CBA/ Bankwest forced them into a position where they defaulted on their loans, Bankwest put in receivers and subsequently sold the property at a portion of their value. Sometimes at 8 percent of their value.
We have been told by bank officers off the record that Bankwest simply drew a line in the sand and said all these loans have to go. And over the past two years this is what has happened about a billion dollars' worth.
It appears now (some two years later) that CBA may be in its financial stages of writing off these loans before they try to bring Bankwest under their banking licence in May. This is why Mr Wharton's loan (and so many others) are being called. There have been some suggestions of possible misconduct by CBA against HBOS, Lloyds and the British Government.
When CBA bought Bankwest off HBOS and once the deal was done, CBA then assessed the Bankwest loan portfolio and wrote any 'bad or doubtful' debts off. This provision went from about $80 million the year before to $900 million that year.
The provisions were in the purchase agreement that these bad or doubtful debts would come off the purchase price under a 'adjustment to the consideration" in their terms.
So $900 million comes off the purchase price. This was in the year when CBA made Australia's highest corporate profit of $6.5b in the middle of the worst economic disaster in 80 years. Fishy?
It is very hard when you have worked your whole life to be wiped out by a stroke of someone's pen simply for financial gain.
