The Australian, February 13, 2018
73 completed and ongoing inquiries into the financial services industry, and precious little for victims of misconduct to celebrate, a palpable sense of hope and anticipation swept through the main hearing room in Melbourne when royal commissioner Kenneth Hayne formally opened proceedings.
Despite its massive breadth and compressed timeframe, the aura surrounding a royal commission and yesterday’s bizarre recital of a tribute in its terms of reference to “Elizabeth the Second, by the Grace of God Queen of Australia and Her other Realms and Territories”, had elevated expectations that justice would finally be done.
The hearing room, which seats about 50, was full.
So was a spillover room where highly priced legal talent, including Arnold Bloch Leibler’s go-to litigator Leon “Mr Fixit” Zwier, mingled with assorted victims, advisers and hangers-on.
Commission staff hurriedly prepared a second spillover room.
But after an hour and five minutes of opening statements from Hayne and counsel assisting Rowena Orr QC, it was all over.
For the industry and victims of misconduct, the good and bad news was shared in roughly equal measure.
It’s clear from the outset that Hayne will not tolerate his commission becoming a soapbox for customers with unresolved issues.
A lot of the commission’s work will be done through written submissions, and where public hearings are held they will be informed mostly by settled matters to determine how and why the institutions behaved as they did, and what should be done about it.
For the companies under scrutiny, there will be zero tolerance for delays in meeting Hayne’s rigid deadlines, and even less so, perhaps, for any attempt to muzzle whistleblowers or rely on confidentiality agreements to avoid the commission’s screws.
Hayne announced his no-go zones in his customary dry and dour way, complete with well-rounded vowels.
There was no masking his determination, or iron will, particularly when he crushed a brief moment of rebellion from the floor at the end of his monologue.
Aggrieved customer Dennis Sgargetta chose that moment to spring to his feet, quoting the “ninth divine law” (we should not lie to each other) in the context of his $299,000, decade-long residential mortgage dispute with National Australia Bank.
Sgargetta had barely opened his mouth before a somewhat startled Hayne recovered his composure and again shut the hearing down.
The commissioner quickly departed, leaving Sgargetta to continue his diatribe and distribute press releases.
Another victim to attend yesterday’s first public hearing was Naomi Halpern, an investor whose financial adviser put $641,000 of her money into collapsed agricultural investment schemes such as Timbercorp, despite Halpern stipulating she had a low appetite for risk.
Peter Paymond Holt was banned for three years by ASIC in 2012 for failing to comply with financial services laws, which Halpern described as “pathetic” given the devastation he had caused her and other clients.
Her former adviser, she said, still lived in a multi-million-dollar home and drove “flash cars”.
Halpern, in contrast, had been forced to refinance her home twice and work for years to repay her debts.
After listening to yesterday’s opening statements from Hayne and Orr, she was relieved that confidentiality agreements would not block her from giving evidence.
On the other hand, Halpern said there were “multiple issues” that the commission needs to pull apart and investigate.
“I think a year for the commission to operate is not long enough; the issues are so vast,” Halpern said.
“I understand there’s a need to look at themes, but there’s a lot of people whose issues won’t be addressed because there’s simply not enough time.”
Halpern fervently hopes for an extension.
But that appears to be the last thing on Hayne’s mind.