Page 994 - Week 04 - Wednesday, 31 March 1993
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But it is about more than banking, it is also about parliament, politicians, the courts, the media and the imperfections of them all. At its best democracy is imperfect, but ours is not at its best any more. So it is also about the failing health of our democracy.
In this book, Bankers and Bastards, Paul McLean published the Westpac letters. I think it is worth while noting once again what they are about. The book states:
The information in the letters was described by their writers as "devastating", and devastating it was. Here was a leading Australian legal firm, Allen, Allen and Hemsley, telling Australia's largest commercial bank, Westpac, that in their view there was a strong possibility that officers of their wholly-owned subsidiary, Partnership Pacific Pty Ltd, could be guilty of fraud, breach of fiduciary obligations, tax evasion and breach of their statutory obligations to the Reserve Bank, and then going on to suggest ways of minimising the damage from any litigation which might follow from action by customers.
It took some time to unravel all the details of the scam. Indeed, many of the details are still not known, Westpac having "lost" some of the key documents. But the bare bones were clear. Partnership Pacific (PPL) sold its customers a "product" which, effectively, enabled PPL to gamble on the foreign exchange market with its customers' money, and pass all the risk and the withholding tax to the customers, while taking the lion's share of the profit for itself. This would, if true, amount to one of the greatest corporate frauds in Australian history.
Paul McLean sent the Westpac letters to Dr John Hewson. McLean received a letter from Duncan Fairweather, the chief of staff in the office of the Leader of the Opposition, and it said:
During Question Time today an envelope was delivered to Dr Hewson's office by a member of your staff who said it contained "Westpac papers".
This material has not been requested by Dr Hewson and I return it to you unopened.
The letters were also sent to Paul Keating. Keating, through his staff, said that it was nothing to do with him. At the time he just happened to be the Treasurer and the Minister for banking, but he said that it had nothing to do with him that the largest commercial bank in Australia had been told by their legal experts in a confidential document that, putting it bluntly, they were crooks.
Bruce Miller, some months ago, placed a very small ad in the Canberra Times. It said that a public meeting was to be held with those people who considered themselves to be victims of the State Bank of New South Wales, with a view to doing something about the unethical practices of that bank. I phoned up on the Saturday morning, when I saw that little ad. I was actually the first to do so, but not the last by a long shot, because literally hundreds of phone calls have come in to Bruce Miller since that small ad. Members well know that a meeting was held in Tuggeranong. Mr De Domenico attended. Some 70 people, some from interstate, came with some of the most heart-rending stories about people who presented themselves as valuable business people being ripped off by totally unethical practices of the State Bank of New South Wales.
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