Labor senator Sam Dastyari has demanded the Australian Securities and Investment Commission (ASIC) attend before the Senate economics committee next month to explain its apparent supervisory lag in the Myra Home Loans matter.
A mortgage broker continued to work in the industry long after his alleged fraudulent loans between 2008 and 2011 were detected, and then after the arrest and court proceedings earlier this month.
“This is outrageous. It’s once again a demonstration of ASIC failing to act when all the evidence is before them,” Sam Dastyari told The Australian.
Dastyari claimed that the issue was not the regulator’s lack of power, but that it was not using the powers it already had.
“For those of us who have increasingly lost faith in ASIC’s ability to be the tough cop on the beat, situations like this reinforce the view, as Greg Medcraft said, that Australia is becoming a paradise for white collar criminals. There is this constant failure to act.”
The Melbourne man arrested after an alleged $110 million mortgage fraud, Aizaz Hassan, was capable of writing loans until his accreditation was stopped on Tuesday this week, 6 January 2015.
Hassan had appeared before a bail justice on 2 January 2015, bailed on conditions including that he report to police twice a week, surrender valid passports or any other valid travel documents and not apply for any other, not attend any points of international departure and not leave Australia.
He will reappear at the Melbourne Magistrates’ Court on 17 April 2015.
Hassan held his credit licence through several lenders since 2011, currently with Australian Finance Group, one of the country's largest mortgage brokerage networks.
Hassan and another Melbourne man, Najam Shah, have been arrested and charged following an ASIC investigation into the alleged use of false documents in support of loan applications valued at about $110 million.
Shah and Hassan have been charged with one count each of common law conspiracy to defraud, according to an ASIC release.
The charges relate to the men’s roles at a Footscray company, Myra Home Loan Pty Ltd trading as Myra Financial Services (no longer trading).
It is alleged that between April 2008 and December 2011, Shah and Hassan conspired to defraud 12 lenders, banks and other financial institutions, by creating and using false documents to support loan applications submitted on behalf of Myra clients.
At least 350 loans valued at $110 million were submitted and approved on behalf of Myra clients.
The alleged conspiracy involves submission of false documents for more than 300 loan applications to numerous banks and financial institutions, including the Commonwealth Bank of Australia, Westpac Banking Corporation, St George Bank, Bankwest, Adelaide Bank, ANZ, Bank of Queensland, Choice Home Loans, Citibank, National Australia Bank, Pepper Homeloans and Suncorp Bank.