Australia's Bankers Get Caught Behaving Badly

Australia’s finance industry came through 2008 with flying colors. Then it got cocky

- Emily Cadman

After navigating the 2008 global financial crisis with barely a bump, Australian banks looked to most observers like paragons of virtue. But to Jeff Morris, a financial planner at Commonwealth Bank of Australia, the country’s biggest lender, they were anything but. From his insider’s vantage point, he saw a toxic, bonus-obsessed culture where star employees forged documents and steered unwitting customers into high-risk investments that often tanked. “I watched fleas do over innocent people,” he says.

He didn’t keep quiet about it: Morris first raised his allegations with the Australian Securities and Investments Commission in 2008. Then, believing systemic problems were being swept under the carpet, he took his concerns public in 2013, sparking widespread outrage. Five years later, Australia’s once-lauded financiers finally face their moment of reckoning. A government- ordered investigation into financial wrongdoing that began in March has unearthed a seemingly endless string of scandals, including charging dead people for services, lying to regulators, taking bribes, and dispensing such bad investment advice that some customers lost their homes.

The inquiry has identified thousands of breaches, some of which could lead to criminal charges. Australia’s banking leaders, including Commonwealth Chief Executive Officer Matt Comyn, have apologized profusely. Nevertheless, on top of previous scandals involving rate-rigging, front-running currency trades, and violations of laws to prevent money laundering, the revelations have pushed public and political tolerance to a breaking point.