Great Southern investors threatened with black-listing Two complaints lodged
By Kate Kachor Mon 07 Dec 2009 A litigation firm has lodged official complaints against banking group Bendigo and Adelaide Bank following threats against Great Southern investors.
Black-listing threats against Great Southern investors have forced a litigation firm to lodge official complaints against banking group Bendigo and Adelaide Bank.
Melbourne-based legal firm Macpherson and Kelly has lodged two complaints, one with ASIC and one to the privacy commissioner, over the bank's conduct regarding Great Southern client loans.
"We made an official complaint with ASIC and followed up with a second one and we're waiting for a response from them as to this constant badgering of people that they know are represented by us," Macpherson and Kelly principal accredited commercial litigation specialist Ron Willemsen said.
"We've written and complained to the bank's lawyers, we have flagged a complaint to the privacy commissioner as well because we think the bank had no legal basis for even making the report because they didn't get the consent at the outset from our clients.
"A lot of our clients are pretty annoyed by it all and we're keeping on the opposition's hammer in relation to that and we'll see what ASIC comes back with and the privacy commissioner."
The complaints surround claims that Bendigo and Adelaide Bank was involved in transferring original client loans with Great Southern Finance Pty Ltd across to the bank without prior notice of clients.
As part of Macpherson and Kelly's Great Southern class action, the firm has advised its 1600 clients to stop making repayments on their loans with Bendigo and Adelaide Bank.
"Bendigo Bank recently made a presentation to the market [that] they acknowledged that the vast majority of people in arrears are what they term strategic defaults, people that under legal advice are not paying for legal reasons as distinct from 20 per cent who are your traditional credit fault who are not paying because they can't pay," Willemsen said.
"They have acknowledged that openly, yet they have threatened to black-list people from skipping on payment, therefore making it difficult for people to get credit for anything else they might want credit for down the track.
"They are very aggressively chasing people for money, including getting in contact with our clients, and we keep complaining about [it] because they should be getting in contact with us. They are just on this really intensive campaign contacting everyone who is in arrears."
Macpherson and Kelly said it expected to issue an action against Great Southern in the coming months.
The action against Great Southern would involve the responsible entity, Great Southern Finance Pty Ltd, directors Phillip Butlin and Cameron Rhodes, and former director John Young, Willemsen said.
[[You forgot Steven Cole the RE or trustee who represented the growers and investors interest]]]
As part of its case, Macpherson and Kelly intends to claim an example of this occurred with a failed 1994 timber plantation.
The project was going to yield a significant loss for investors when harvest time came, but Macpherson and Kelly alleges Great Southern tipped in $3 million to make it appear the project was profitable.
"Really from that time onwards, we say, on behalf of our clients, that Great Southern engaged in misleading or deception conduct and that's what the class action will be all about," Willemsen said.
Bendigo and Adelaide Bank was unavailable for comment.
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