The listed law firm Slater & Gordon has confirmed it is working on a class action against Bankwest, alleging improper lending practices after its takeover by Commonwealth Bank of Australia during the global financial crisis.
Van Moulis, commercial litigation lawyer at Slater & Gordon, says he’s working on due diligence on behalf of a group of more than 27 aggrieved borrowers. Slater & Gordon is working in tandem with the litigation funder IMF.
Moulis says the borrowers are primarily property developers, including co-ordinator Guy Goldrick, a Sydney property developer who has accused Bankwest of pulling loans at short notice and for insufficient reason.
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Moulis says he’s “reasonably confident” the case will proceed, calling on property developers who believe they were victimised by “improper” lending practices and recovery practices around 2008 to contact the law firm.
A Bankwest spokesperson says the bank will “always consider and respond to any legitimate query raised by a customer.”
The confirmation comes as Nationals Senator John Williams speaks to fellow Senators about the prospect of a Senate inquiry into whether banks are pulling loans to small business clients, including farmers, leading to assets being sold at rock-bottom levels.
Williams told SmartCompany earlier this week there are “appalling” examples of asset being sold far below their value.
Moulis says a class action would likely complement a Senate inquiry.
“Whatever comes first,” he says. “We’ll probably end up with both.”
Property developer Guy Goldrick told SmartCompany that he had received hundreds of calls from Bankwest customers complaining about the bank’s behaviour since its takeover by CommBank.
Goldrick is the owner of Mortgage Wise Australia, and says he was involved in a development that was funded by Bankwest.
The thrust of Goldrick’s argument is that a provision allowing CommBank to claw back bad and doubtful debts from vendor HBOS has led to the bank “making harsh decisions”.
“It started as soon as it was taken over; people put to the sword by the stroke of a pen,” he said.
“We’re alleging that most of these loans would have never been considered to be bad or in default, and that all of a sudden the loans were bad.
“The question mark is how they changed in one day.”
But a Bankwest spokesperson says Goldrick has no claim against the bank.
“Guy Goldrick is not a customer of Bankwest and he has no claim against the Bank. His allegations concerning Bankwest have no merit.”