Financial industry has grip on political system, SACPA told

In Australia, the big banks are under investigation. A Royal Commission has found the financial services industry has put greed and short-term profits ahead of its customers’ interests — and basic honesty.

And that’s little different from the industry in Canada, a Lethbridge audience was told Thursday.

But rather than investigating the situation, industry critic Larry Elford said, the Canadian government has exempted banks and financial products salespeople from prosecution under its “white collar crime” legislation.

This fall, Australia’s banking and investment was severely criticized when Royal Commission officials released their first report.

“This interim report is a frank and scathing assessment of the culture, conduct and compliance of our financial system,” said commissioner Ken Hayne, who tabled the 1,000-page document.

The nation’s securities and investment commission was blasted as well, for giving Australia’s bankers free reign. That seems to be happening here as well, Elford told the Southern Alberta Council on Public Affairs.

In Canada, “The financial industry has a complete grip on our political system.”

And it’s able to request — and obtain — exemptions from Canadian laws that are supposed to ensure consumer protection, he reported. As a result, Elford said many Lethbridge people have seen their retirement incomes shrink after investment retailers convinced them to switch to a product they were selling.

They should ask “Whose retirement is going to benefit,” he suggested.

Today’s bank employees, Elford said, are pressured to boost their company’s profits by “upselling” extra financial services.

“You’re under the gun every day to produce, or you’re out.”

But that’s not the way credit unions operate, he told a questioner. Governed by a board of locally elected directors, they work for their members’ best interests.

“Credit unions get my seal of approval.”

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