The Australian government has launched an inquiry into the country’s financial sector, which has been rocked by scandals over the last few years.
The inquiry, launched on Monday, will be closely scrutinizing the tactics used by banks to sell their most lucrative product, mortgages.
It is thought that the Royal Commission inquiry will expose some of the country’s biggest and most profitable financial companies to never-before-seen levels of scrutiny.
Top executives are more than like to face public grillings and be compelled to disclose confidential documents.
Mortgages are a lucrative product for Australian banks, with the four major lenders, Commonwealth Bank of Australia (CBA), Australia and New Zealand Banking Group, National Australia Bank, and Westpac Banking Corp, holding around 80 percent of the A$1.7-trillion mortgage market.
“The commission will hear evidence of events involving certain financial services entities in the context of home lending that suggest that consumers have not always enjoyed the right to be treated honestly and fairly when it comes to home loans,” a barrister assisting the commission, Rowena Orr, explained at the beginning of the inquiry.
“Some of these events may have involved breaches of the law while others may have involved departures from community standards and expectations,” she explained.
The Royal Commission said more than 385 public submissions were received in relation to banks, which it said reflected the erosion of public trust in the sector.
The commission’s final recommendations could lead to criminal or civil, while the sector might find itself facing greater regulation.
The inquiry, being held in Melbourne, is scheduled to endure for at least a year, and will also scrutinize the wealth management and financial advice industries.