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FOS scheming with Lender to close our case?

Posted by on in Reserve Bank of Australia
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 Help please!!!

FOS it appears is planning to close our case. Re: complaint of falsified docs, unconscionable behaviour, attempted repossession and no LAFS. It is a commercial loan but we were made to be guarantees.

 A deadline has been given to answer questions on our losses however the lender seems to be excused for not answering our questions in validation and falsifying contracts. The lender also ignored the evidence that they wrote the debt off, as we have evidence of them requesting the insurer for payment of the debt. They also would be claiming this in Tax.

  It took FOS 6 months to come back with a letter that provided no answers to our questions or validation. The only response from the lender was to say that they will make no further submissions. FOS says that’s fine as the lender answered FOS questions. We don’t even know what those questions were as no documentation of their communications has been given to us.

 We have past evidence of email conversations backwards and forwards between lender and FOS but nothing current.  In their past communications all along they were trying strategies to close our case. We also have evidence that the lender noted our request for adequate assurance and validity of the debt. They mention that they will forward the letter to  2 contacts in LLOYDS LEGAL.  They also noted that our letter had pointed out they were in default under certain acts of the trade practices act.

Lender responded with an offer not acceptable to us and FOS noted to lender via their backwards and forth communication emails that if we didn’t answer they will close our case. That was back in December 2010.  The lender did not answer our questions nor give adequate assurance of the debt.  They have ignored all obligations in answering our questions.

We have also now asked for our LAFs and noted we are a member of BFCSA.  But still we are being told that we have to answer the questions of our losses which we already have done in the past, otherwise they will close our case . We have not been provided with updates on FOS and the lender email communications but are certain they are strategically reaching finale for the benefit of the lender as they are obstinately overlooking that our questions have not been answered and it is one sided.

 Interesting though we approached the broker for the LAFs. Their response was , “Why would you need that? I only have the contract. There is no loan application docs. We recall giving financial details and filling in a form.  We were then told the following.

 The approvals are based on what we call commercial matrix approval where financials are not required for plant and equipment/or vehicles up to $35,000 (this is not for consumer finance).


Approval is based on 4 main criteria as follows:


·        2 years minimum in business

·        Asset backing of directors/business owners

·        Clear credit history (no defaults)

·        Provision of a Good finance reference


Under duress we were made to sign a guarantee.  We also had been in business for only 3 months, NOT THE REQUIRED 2 YEARS according to regulations and Lending Policy Guidelines.

 As FOS appears to be protecting lenders any assistance or advice on this matter would be appreciated.

EDITOR:  Demand through FOS that the  Lender hand over a copy of THE LENDING POLICY GUIDELINES (for relevant period) and also a copy of THE AGREEMENTS WITH THE BROKER CHAIN.

You are entitled to view these documents for you and FOS to ascertain whether the matter was an IMPRUDENT LEND or not.  I would have thought those documents were the first thing FOS would have asked for surely?


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Tagged in: Banking fraud; FOS FOS


  • doyla66
    doyla66 Friday, 24 August 2012

    Which bank?

  • doyla66
    doyla66 Friday, 24 August 2012

    Hi JJ, the lender is Capital Finance.

  • doyla66
    doyla66 Friday, 24 August 2012

    Loan sharks.

  • doyla66
    doyla66 Friday, 24 August 2012

    Thought about abit of publicity about it?

  • Denise
    Denise Friday, 24 August 2012

    Demand through FOS that the Lender hand over a copy of THE LENDING POLICY GUIDELINES (for relevant period) and also a copy of THE AGREEMENTS WITH THE BROKER CHAIN.

    You are entitled to view these documents for you and FOS to ascertain whether the matter was an IMPRUDENT LEND or not. I would have thought those documents were the first thing FOS would have asked for surely?

    [email protected]

  • doyla66
    doyla66 Saturday, 25 August 2012

    Thanks Denise will do. xo

  • doyla66
    doyla66 Friday, 24 August 2012

    Remember who pay their wages. "Financial institutions/Banks"
    Sorry I do not trsut them. Had a 12 month ongoing case but ended up losing. By then the bank had every bit of info they wanted from us. Next thing court and what do you know they still have all our docs copies to look at. We had falsified docs etc didn't make any difference. Bank consistently only provided what they wanted to and the answers to our questions were never answered just left blank. No Laf's etc either. Not even in court in discovery the solicitors had selectively filled the discovery files with what they wanted even though I lifted a copy of every doc involved with the loan. Good Luck I hope your have better luck than we did. I keep my fingers crossed for everyone who is in the clutches of the banks.

  • doyla66
    doyla66 Friday, 24 August 2012

    Sack your current FOS case manager!!.. Ask for the one who looked after MR. G .. hopefully they still are around. Just checked our Capital Finance website - .. Reading the spiel nearly made me throw up!

  • doyla66
    doyla66 Friday, 24 August 2012

    I learned that FOS don't actually protect us. They are more like a mediator in a negotiation, as I understand it. The "protection" from litigation comes from the dispute resolution process with questions and answers going back and forward.
    Have you given your FOS assessor/case manager a list of the questions that the lender has refused to answer?
    Do you deal directly with the lender or do you send everything through your FOS person?
    We deal directly with the lender, or more accurately my representative deals with their representative, both of whom are experienced negotiators and mine is also an advocate.
    Do you have an advocate or intermediary speaking for you in this case?
    Did FOS refer you to get "legal advice" on your case?
    COSL insisted that I do that with the free legal people.
    I found COSL wanting information from me. I supplied that information but only after getting a "promise" from the lender that they would supply their part: the contract for the loan. Then they pulled a swifty on COSL who said it was closed and now it's open again after I wrote straight to the chairman of COSL asking for the case to be reopened as it was closed in error through a misrepresentation by the lender to COSL. You can do the same with FOS or ask for an "independent assessment" by another party not involved in the case. That's what I've done from the start with my FOS case ... everytime the lender puts pressure on about "settling" (with what?) we remind them that we're waiting for the independent assessor to review our case and come up with a determination.
    I don't know if that helps at all....

  • doyla66
    doyla66 Friday, 24 August 2012

    I don't think at this point publicity would be the answer but thanks for your thought. It's more a case of defining Fos's role as we believed and are told that they are there to protect consumers and people's rights. But they appear to turn a blind eye to any laws and acts broken by the banking sector in their reconcilliation process.

  • doyla66
    doyla66 Friday, 24 August 2012

    This on FOS website under Cases - Maladministration in Granting Loan - Can you ask for a new Case manager?

    Mr G was a self employed builder. In July 1999 he approached the bank about an organic fruit and vegetable business he was considering purchasing.

    Mr G was provided with a loan of $125,000 which he used to purchase the business for $120,000, with the additional $5,000 being for working capital. The bank also provided lease finance of $39,000 for a new van for deliveries and a bank guarantee for $7,950 in relation to the rental of the business premises. Security was provided by a mortgage over Mr G’s investment property which was vacant at the time with a renovation about 75% completed.

    At the time, Mr G’s existing debts included a loan in relation to the investment property, a loan in relation to a property he had purchased jointly with his girlfriend and a credit card debt.

    It soon became apparent that Mr G could not meet his monthly commitments from the returns of the new business. In December 1999 he placed the business (including the van) on the market for $125,000. The business was ultimately sold over twelve months later for $35,000.

    Mr G subsequently complained to this office claiming that the bank should not have granted him the loans because he did not have the capacity to meet the repayments.
    The Financial Ombudsman Service obtained the bank’s lending file for Mr G which included loan applications and supporting documents, internal notes about the applications, and assessment documentation. After reviewing this information, the case manager formed the view that the bank had not acted prudently, and its decision to lend to Mr G constituted maladministration because:
    •The bank provided 100% finance plus working capital and a lease for a business in which Mr G had no prior experience. According to the bank’s internal lending guidelines, Mr G ought to have had at least 2 years’ experience in the industry to demonstrate “satisfactory management experience”.
    •Assessment of capacity to service the loans was based on incomplete and out of date financials. The bank relied entirely on vendor financial statements and did not request accountant prepared cash flow forecasts. The vendor’s financial statements apparently indicated that the net profit of the business increased by 300% from 1996/97 to 1997/98. Given this significant and unexplained improvement, the bank ought to have undertaken further analysis to satisfy itself about the sustainability of the 1998 results.
    •Serviceability relied on rental income from Mr G’s investment property. That property was, however, undergoing renovation and was not in a habitable state. Therefore, rental income should not have been taken into account.


    A conference was held with the parties and the Ombudsman, and further negotiations took place over subsequent weeks. The dispute was settled with the bank reducing Mr G’s outstanding debt by $90,000. This represented a 75% reduction in the debt.

  • doyla66
    doyla66 Friday, 24 August 2012

    Good to know!

  • doyla66
    doyla66 Friday, 24 August 2012

    Thanks arree will check it out. ox

  • doyla66
    doyla66 Friday, 24 August 2012

    Thanks arree will check it out. ox

  • doyla66
    doyla66 Friday, 24 August 2012

    Thought about abit of publicity about it?

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