John Williams wants royal commission to investigate the practice and calls for tougher penalties. The Nationals senator John Williams says liquidators need to face much tougher penalties if they fail to sell repossessed farm assets for market value.
He says the practice is destroying farmers’ lives in Australia and needs to stop.
Williams said he hoped the banking royal commission would investigate the practice when it looked at farming finance, and added that section 420A of the Corporations Act was a “toothless tiger” that was not being enforced.
The next round of the banking royal commission begins next week, where it turns its attention to farming finance, natural disaster insurance, and interactions between Aboriginal and Torres Strait Islander people and financial services entities.
For the first time, it will hold public hearings in Brisbane and Darwin to hear directly from farmers in rural and regional areas.
Australia’s big banks have been preparing for the next fortnight, and the bank chief executives have met federal politicians in Canberra.
The Commonwealth Bank chief executive, Matt Comyn, visited parliament on Tuesday and addressed the Nationals’ party room, telling them CBA knew it could improve its relations with farmers.
In April, Comyn had also visited Williams in Inverell, New South Wales, to hear directly from farmers about their concerns about bank finance.
“Mr Comyn was quite open about where the Commonwealth Bank had been and where he needs to take it to to change it, and I respect him for that,” Williams told Guardian Australia.
“He did make the point that there were some 45,000 employees in the Commonwealth Bank and you can’t look over the shoulder of each and every one of them. But we had a good general discussion about many issues.”
Comyn was also scheduled to meet the Labor MP Matt Thistlethwaite and the Greens senator Peter Whish-Wilson.
With a devastating drought hitting large parts of the country, CBA also extended more drought support measures to farmers this week.
The Nationals MP George Christensen told parliament this week he thought the royal commission should be extended so it had more time to consider bad bank-lending practices in regional areas.
“It would be a tragic lost opportunity if the full extent of deliberately dodgy banking practices were not exposed,” he said.
He told Guardian Australia he had seen evidence of forged documents and other unethical behaviour pushing people into certain loans, and he wanted the royal commission to take a serious look at it.
“I don’t know if it’s systemic or not,” he said.
Williams said he would like to see a situation where liquidators were no longer used to force the sale of farms and farm assets on behalf of banks. He said banks needed to work harder with farmers to allow them to leave their properties with dignity.
“In last year’s Senate inquiry into rural lending, there were too many cases of assets being sold for far less than what they’re worth, and I think that’s a big concern,” he said.
“The breach of the Corporations Act, if you’re found guilty, is just a toothless tiger. So I hope what comes out of this royal commission, is when banks do send in the receivers or the bank themselves sell up the assets of the business, they pursue maximum value of the asset.
“In fact I’d like to see a situation where receivers are no longer sent into family farms.”
The commission’s hearings on bank finance will listen to witnesses from Commonwealth Bank and Bankwest, Rabobank, NAB, Bendigo and Adelaide Bank (Rural Bank), and ANZ (Landmark).This article was first published by https://www.theguardian.com/australia-news/Author: Gareth Hutchens