Gold Kennedy Award
Every day Australians go about their business placing trust in our biggest corporations and government regulators. These pillars of society are perceived to be on our side and will keep us safe from darker forces of capitalism. Sadly, this isn't always true.
At a time when investigative journalism is under unprecedented pressure, The Sydney Morning Herald exposed that Australia's biggest bank, the Commonwealth Bank and the corporate regulator, the Australian Securities and Investments Commission (ASIC) had betrayed the trust of customers and citizens.
The horrific cover up - which effected thousands of clients and potentially hundreds of millions of dollars of retirement savings - was exposed with the help of brave whistleblowers who for sixteen months had been alerting ASIC of how a group of financial planners were ruining the lives of thousands of Australian's at their most vulnerable.
The stories revealed that even after some of these financial planners left the bank, the cover up continued as managers falsified some client documents.
The victims were mainly elderly people who had trusted 'the people's bank' as they had been saving with it since their childhood. Instead they were placed in high risk, high fee paying CBA products without their consent, sometimes with forged signatures. Some had their money in savings deposits and were deliberately put in CBA’s mortgage funds to meet the bank’s sales targets. These funds were then frozen for four years while the bank continued to take trailing commissions.
Many victims were forced to go on the pension. CBA offered compensation to 700 customers, with evidence that some of the offers were low ball. Some are still waiting to be compensated.
Journalism matters most when it results in change that improves our society. The CBA scandaltriggered anger among politicians who had questions about the peak securities regulator - triggering a bipartisan senate inquiry to be heard later this year.
Following the publication of the stories, many hundreds of ordinary Australians who were customers of the bank contacted us with scandalous stories of how their finances had been mismanaged or possibly fraudulently managed. After years of feeling powerless in combating an institution as big as the Commonwealth Bank and silence from the regulator, the force of journalism was working in their favor.
The bank tried to stonewall using delay tactics and refusing to answer questions designed to make it more difficult to get the truth out. Its head of communications also tried emotional and commercial threats. This only strengthened the resolve of The Sydney Morning Herald to push forward with the series.
The articles were based on painstaking investigative journalism sifting through hundreds of leaked documents, confidential emails, memos, and involved extensive interviews with victims, former CBA staff, and industry experts. We achieved a break through when one of the whistleblowers Jeff Morris bravely agreed to go on record and tell his story about his time at the CBA, and in the process reveal the incompetence of ASIC.