THE co-owner of a controversial Bank of Queensland branch in Townsville has admitted his staff falsely witnessed loan applications on a regular basis.
Declan Carnes, joint owner/manager of the North Ward franchise, told the Supreme Court that one of his employees witnessed the signature of a disabled man who was being treated in hospital hundreds of kilometres away.
Justice Jean Dalton said the action was “probably dishonest”. But Mr Carnes admitted he had never investigated the matter even though he was aware of allegations that the customer’s signature had been forged as well.
And under cross-examination, Mr Carnes said it was not unusual for staff to falsely witness customer documents.
Bank of Queensland has launched an investigation.
It is the latest controversy for the North Ward branch, which was responsible for 267 of the 319 loans made by the Bank of Queensland to customers caught up in the disastrous Storm Financial collapse.
In the latest case, BoQ sued Mervyn and Pamela Hills, both 70, for hundreds of thousands of dollars owed on a loan to buy the “Seashells” fish and chips shop just behind the North Ward branch in 2007.
Pensioner Mr Hills, who was left paraplegic after a car accident, was allowed to act as a guarantor and put up the couple’s home as security against the loan.
The Supreme Court hearing in Brisbane last month heard that branch employee Darren Wall witnessed a document in Townsville while the customer was in hospital in Brisbane.
Mr Hills gave evidence that the signature on one document was not his.
Mr Carnes said he was aware of the forgery allegation but had not questioned Mr Wall, who still works at the branch. “I don’t believe Mr Wall would have done that,’’ he said.
Cross-examined, he agreed that the bank’s practices were “not consistent with the standards of a banker exercising ordinary skill and care”.
During the trial Mr Carnes agreed it was inappropriate to require Mr Hills to give a personal guarantee and mortgage over the house and agreed some documents were “inexplicable’’.
Head office staff responsible for loan approvals said “pertinent information” — including Mr Hills’ condition — had been withheld.
A settlement reached since the trial requires the couple to pay BoQ $369,012 plus $93,204 in interest. A counterclaim by the couple alleging unconscionable conduct was dismissed. Mr Carnes did not return calls. Mr Wall, who was not called as a witness in court, declined to comment.
An ASIC spokesman would not comment on the case.
Author: DARYL PASSMORE
Source: The Courier-Mail