1. Second Wave of Royal Commission
into Financial Services:
Duration: Two weeks (one week of hearings followed by one week
of questioning/cross examination of financial regulators in particular the
Principal Regulator of the
Payments System)
One Week Of Hearings - Six Hours
a Day For Five Days from
(1)
Financially Uneducated And Vulnerable Australians
identified by the RBA as
Persistent Revolvers
-
sourced by
Financial Counsellors; and
(2) Quantitative, Qualitative,
Credit Card Distress Authorities,
Numeracy And Literacy Authorities, And Newspaper Article
Evidence Of Unfair Credit Card Practices Which Prey Upon
Financially Uneducated And Vulnerable Australians
By
Numeracy And Literacy Discrimination,
in particular
Credit Card Distress Authorities
and
Numeracy And Literacy
Authorities
Then one week of
cross examination/questioning of
-
(A) Governor of the
RBA
(re 'Sixteen Questions" in 2. of
Version2 of
Letter to
Dr. Peter Brandson dated 16 March 2019); and
(B)
Chairman of APRA, ASIC, ACCC and CEO of ABA (re another 6 Questions in 2. of
Version2 of
Letter to
Dr. Peter Brandson dated 16 March 2019)
Singular Term of Reference: Breach of
Statutory Duty
by the
RBA
as
Principal Regulator of the
Payments System
through its
Payments Systems
Board that countenanced
Predatory Marketing
of
Credit Card Products to
Financially Uneducated And Vulnerable Australian
Credit Cardholders
- many have paid
Usurious Unsecured Interest Rates
and suffered
Extreme Financial And Emotional Distress
contrary to
the RBA's parliamentary decreed role to ensure
"...the economic prosperity and welfare of
(all) the people of Australia"
2.
Sixteen of the
Thirty Two Written Questions
(to extend the Royal
Commission to address inter alia 1. above) are directed at the
Governor
of the Reserve Bank of Australia - some will be difficult and embarrassing to answer. A
further six Questions are directed to other financial services regulators
Notwithstanding the above claims on the
Bank Reform Now website,
the
Writer never received any response from
Dr. Peter Brandson.
Click on
Thirty Two Questions and
Supporting Evidence
for a second wave of the Royal
Commission
to consider asking -
A.
"the principal
regulator of the payments system through the PSB", and
Chair of the
Council
of Financial Regulators,
that -
(1) has
extensive powers
to request information from payment system participants and operators regarding
inter alia
Credit Cards under, amongst other clauses,
Part
5—Miscellaneous, Section
26
of the
Payment Systems
(Regulation) Act 1998;
(2)
is bound to
"
....inform the Government, from time to time,
of the Bank's monetary and banking
policy"
under
Section
11(1) of the Reserve Bank Act 1959
having regard to its obligations under
Section 10(2) 'Functions
of Reserve Bank Board' of Reserve Bank Act 1959 to
"best
contribute to.......... the
economic prosperity and welfare of the
people of Australia"; and
(3) holds authority under
Division 4, Section 18
of the
Payments System Regulation Act 1998 to
set Standards that
"are in
the public interest" for a previously 'designated
Payments System (under
Division 2—Section
11
of the
Payment Systems
(Regulation) Act 1998
after having also imposed an
Access Regime
under
Section 12
Between 1960 and 1980
Australia's 'central
bank',
the Reserve Bank, diligently regulated Australia's
commercial bank interest rates relying on, inter alia,
Section 50
of the
Banking Act 1959
".........
to achieve monetary policy, public sector financing and sectoral assistance
objectives.....",
as
well as
safeguarding against further bank collapses (chronicled in Chapter 17).
The RBA capped the maximum interest rate on Credit Cards in Australia at
18% until April 1985;
B.
the Chair of ACCC as to whether particular aspects of Credit Card Issuers'
marketing representations fall within the ACCC's definition of
Unconscionable Conduct;
C. the Chair of APRA regarding his
undertaking to a Senate Enquiry on 3 June
2017 that included:
"....the margins on credit card business look very high, certainly
to any other form of credit, and certainly I can't sit here today
with an explanation of why that is,"............ and ............
"Informing us all about that is probably a useful piece of work"?
D. the Chair of ASIC
to inform what action ASIC took to
protect
Financially Uneducated And Vulnerable
Credit Cardholders
that have poor
Financial Literacy Capacity,
after ASIC published
Report 224 "Access
to financial advice in Australia"
in Dec 2010 that included:
" ......... the ABS measured skills in document literacy, prose
literacy, numeracy and problem solving and found that approximately 7
million (46%) of Australians (and 7.9 million (53%) of Australians aged 15
to 74) had proficiency less than the minimum required for individuals to
meet the complex demands of everyday life and work emerging in the
knowledge-based economy‘ for document literacy and numeracy respectively".
The UK Guardian article
'The interest-free credit card trap snaring unwitting borrowers' is
rife with examples of UK Credit Card Issuers'
Predatory Marketing
directed at
Financially Uneducated And Vulnerable Credit Cardholders
that
Lack Financial Acumen.
There is a welter of evidence that U.S. Credit Card Issuers are not immune from
similar
Unconscionable Credit Card
Advertising.
One could presuppose:
"Well why shouldn't it be
any different in Australia?" It SHOULD be different in Australia,
because Australia's 'central bank' has unique powers and exceptional responsibilities
"...to..........
the economic prosperity and welfare of the people of Australia"
and for its
Payments Systems Board to always
Act
in the Public Interest,
not held by the 'central bank' of the UK or the USA.
Below is an extract from the Writer's page titled
Australia's Principal Regulator of the Payments System:
"The Reserve
Bank of Australia -
A. has powers to gather financial
information from ADIs under
Part
5—Miscellaneous, Section
26
of the
Payment Systems
(Regulation) Act 1998; and
B. has responsibilities to
'inter alia'
"best
contribute to.......... the economic prosperity and welfare of the people of
Australia" in terms of
Section 10(2) 'Functions
of Reserve Bank Board' of Reserve Bank Act 1959 which
includes
-
"
....inform the Government, from time to time,
of the Bank's monetary and banking
policy"
under
Section
11(1) of the Reserve Bank Act 1959;
to
set Standards that
"are in
the public interest"
relying on
Division 4, Section 18
of the
Payments System Regulation Act 1998 for
a Payments System that it
Designated on 12 April 2001 (under
Division 2—Section
11
of the
Payment Systems
(Regulation) Act 1998;
and
to re-regulate
commercial bank interest
rates relying on
Section 50
of the
Banking Act 1959
that
"are in
the public interest",
that are more
extensive/inflexible/onerous
than the -
1.
Bank of England,
that was not
nationalised as
Britain's central bank
until 1946, which is a
corporation wholly owned
by the UK government -
the 'Corporate governance: Board responsibilities' –
SS5/16 (Short form) focus on the Corporates it
regulates with no
apparent obligation to
best contribute to the
peoples of Britain; and
2.
U.S. Federal Reserve
that was established as
the United States'
central bank until 1913,
although the below item
7. "Promoting
Consumer Protection and
Community Development."
obligates the U.S. Fed
to research the impact
of financial
services practices on
consumers and
communities:
"The Federal Reserve
advances supervision,
community reinvestment,
and research to increase
understanding of the
impacts of financial
services policies and
practices on consumers
and communities."
Australia's 'central bank' has never exercised its rights -
*
under
Part
5—Miscellaneous, Section
26
of the
Payment Systems
(Regulation) Act 1998
to ask for financial data from
the major
Credit Card Issuers
of
Interest & Penalty Fees revenue
for each of their Credit Cardholders for all
Credit Card Products for a minimum of 12 months
in order to establish if the
User Pays Principle applies, notwithstanding that the RBA argued for
greater application of the
User Pays Principle in its paper
"Reform
of Credit Card Schemes in Aust: "A Consultation Document"
in Dec 2001; or
* under
Section
11(1) of the Reserve Bank Act 1959
to
"
....inform the Government, from time to time,
of the Bank's monetary and banking
policy"
having regard to its obligations under
Section 10(2) 'Functions of Reserve Bank
Board' of the
Reserve Bank Act 1959
to
"best
contribute to.......... the
economic prosperity and welfare of the
people of Australia",
to set new Standards under
Division 4, Section 18 of the
Payments System Regulation Act 1998
to
re-regulate a maximum
Purchase interest rate and a maximum Cash Advance interest rate after it
published
LOAN RATE STICKINESS: THEORY AND EVIDENCE
in June 1992 to adopt other
User Pays Principle
fee changes that -
* the RBA recommended in
Dec 2001;
and
* the
Writer recommended in
Section 8
of his letter (on CD) to the
RBA dated 8 Dec. 2011
- explained in Point 9 of
Supporting Evidence re
1st Question.