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Westpac exec gets ASIC ban after preying on elderly's finances

Westpac exec gets ASIC ban after preying on elderly's finances
ASIC has permanently banned David St Pierre, a former Westpac bank home finance manager from engaging in credit activities and providing financial services after encouraging vulnerable clients to borrow against their homes for investments.

St Pierre who was employed by the bank between September 2000 and April 2011 was found to have submitted loan applications to Westpac for approval when he knew that they contained false information and that they were supported by false documents.

The 12 customers to whom the loan applications related were elderly or vulnerable and with limited financial means, yet in spite of this St Pierre encouraged them to borrow against their homes, some of which were unencumbered, to invest in the scheme which promised returns of 15-25% per annum to investors. The customers received monthly interest payments from the scheme after they invested in it, however the interest payments stopped shortly before a liquidator was appointed to CGIC and AAPD on 28 February 2011, which left the customers without sufficient income with which to repay their loans to Westpac.

ASIC has been working with Westpac to ensure that affected customers are appropriately compensated. ASIC acknowledged Westpac's cooperation in relation to this matter.

St Pierre also failed to prepare an authority that accurately identified the payee of a cheque with the result that a customer cheque for $215,000 was paid into the personal trading account of a non-office holder of Capital Growth International Club Pty Ltd (CGIC).

He also enabled and encouraged customers to borrow funds from Westpac and earned a financial advantage in the form of cash bonuses on the loans, in addition to his base salary, despite knowing that they were elderly, a pensioner, a carer or suffering from a disability, and would not be able to repay the loan if the scheme failed.

An ASIC investigation found that the offences happened between July 2008 and June 2010

According to an ASIC statement the regulator determined that St Pierre was not a fit and proper person to engage in credit activities and was not of good fame or character, making him an unsuitable person to provide financial services.

ASIC Commissioner Peter Kell said St Pierre's misconduct was very serious.

"ASIC will ban people from the finance industry who act dishonestly and place personal interests ahead of those they service. Mr St Pierre's actions exposed vulnerable members of the community to severe financial loss and hardship," Kell said.

St Pierre has the right to seek a review of ASIC's decision to the Administrative Appeals Tribunal.

Author: Alice Uribe
Source: Financial Standard
Last modified onWednesday, 12 March 2014 05:54

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