PHOTO: ANZ. FILE
Cleaners and real estate agents getting kickbacks to drive home loan customers to ANZ has seen the bank dragged to court by the corporate watchdog.
- ASIC is suing ANZ in relation to 74 loans that may have breached the National Credit Act
- The loans were referred to the bank by “introducers” — third-parties who were paid commissions for sending customers ANZ’s way
- The banking royal commission heard evidence that some large-scale introducers were tailors or gym owners
ANZ’s ‘Introducer’ program paid third parties a commission and helped the bank write more than 50,000 loans worth at least $18.5 billion over just five years.
But the Australian Securities and Investments Commission (ASIC) has today commenced civil proceedings in the Federal Court relating to 74 of those loan applications, with allegations including fraudulent documents and “facilitating unlicensed persons engaging in credit activities”.
The issue is not the specific occupation of those who made the referrals, but that they were meant to be people with specific insight into customers finances such as accountants and financial planners.
People who give personal financial advice are required to have a credit licence to do so.
ANZ is the smallest of the so-called big four banks, all of which ran programs paying people to introduce customers interested in home loans.
But the problem was obvious: kickbacks were paid if the loans were successfully processed. There was no commission if they failed.
In a statement, ANZ said the civil charges related to three unlicensed third parties that provided home loan application documents to ANZ lenders.
“ANZ has co-operated with ASIC during its investigation and has established a customer remediation program as well as continuously improving its home loan processes and controls,” the bank said in a statement.
Home loans are key to the profitability of Australian banks. ANZ’s annual profit soared 72 per cent to $6.1 billion in the past financial year.
The bank’s chief executive Shayne Elliott said some of that growth was due to growth in home loans during the COVID property boom.
ASIC deputy chair Sarah Court laid out the regulator’s concerns.
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