Queensland farmer Charlie Philpott was 81-years-old when ANZ made the decision to evict him from his property, despite having never missed a single mortgage payment.
Mr. Philpott was forced off his land, in Winton, Central-West Queensland, when the bank devalued Carisbrooke Station due to the drought after it took over his loan from Landmark.
However, ANZ Banking Group have now admitted that their behaviour relating to the incident, which took place in 2014, was not ethical.
During the second day of hearings at the Banking Royal Commission on Tuesday, ANZ head of lending services Benjamin Steinberg accepted the bank did not act fairly and reasonably in the Phillott case.
According to the Sydney Morning Herald, Steinberg confessed they fell below community standards and expectations and breached certain clauses of the Banking Code of Practice.
He told the Banking Royal Commission, in Brisbane: “I think the dealings were consistent but I think they weren’t fair and they weren’t reasonable.”
When asked by Commissioner Kenneth Hayne whether the bank acted in an ethical manner, he said: “It’s fair to say we didn’t.”
Speaking outside the hearing, Mr. Philpott said: “I think people in the banks, those that are running them, have to change their tack, it’s important that they treat people and their clients everywhere as human. They need to also… tailor their services to the rural industry.”
The elderly farmer from Carisbrooke Station, Winton, had owned the property since 1960 and had never, in more than 50 years, missed a single mortgage payment. However, he was driven from the station in 2014 after ANZ lowered its value because of the drought plaguing the region, after it took over Landmark Financial Services in 2010.
Mr. Philpott’s case was one of 10 in which ANZ accepted it engaged in conduct which fell below community standards and expectations or was in breach of the Banking Code of Practice.
The royal commission received 268 submissions regarding agricultural finance, 32 of which related to ANZ’s acquisition of Landmark and its 7124 loans worth AU$2.3 billion.
In another case, Arthur and Rhonda Cheesman, who ran a hay, cereal and lentil farm in western Victoria, lost their home as a result of ANZ’s conduct.
The Cheesmans, who had been with Landmark since 2004, were already facing financial difficulties before the ANZ takeover, as the region had experienced droughts and below average rainfall.
In October 2010, ANZ allowed the Cheesmans to trade for the rest of the season on the basis they would sell assets in early 2011 to clear debt. However, by October 2011 the family was given about two months to sell all of their properties under an asset management agreement, and were told if it did not sell at auction, they would need to surrender their properties within seven days of ANZ’s demand.