Crikey made quite a song and dance last year about the inappropriateness of the PM’s chief of staff, Arthur Sinodinos, leaping straight into a job with Goldman Sachs-JB Were.

We’ve long argued for a cooling-off period of up to two years before such jobs are taken, but clearly this isn’t an argument that resonates with former Reserve Bank governor Ian Macfarlane.

If Macfarlane had taken seriously his responsibilities as Chairman of the Payments System Board, the only photo of him on display at the ANZ Bank would be a “not wanted” poster rather than a pending snap of a happy board member on almost $200,000 a year.

Macfarlane’s tenure as Australia’s central banker and chief financial regulator have delivered historic riches to bank shareholders funded by unprecedented customer gouging, cost cutting and technological efficiency gains.

Since 1996, the combined market capitalisation of the “big four” has almost quadrupled to a record $234 billion – and that’s after more than $20 billion in share buybacks and almost $60 billion in dividend payments.

Australia has one of the world’s most rapacious banking cartels and now the regulator-in-chief has joined the cartel with indecent haste just six months after “retiring” at the age of 60.

The contrast with his predecessor, Bernie Fraser, is stark indeed. Bernie has helped underwrite the success of the not-for-profit industry super funds and the establishment of the Members Equity Bank. And he doesn’t get paid a penny for all those corny television ads.

It’s a shame Macfarlane didn’t pay more attention to developments around the world. Britain’s Independent on Sunday carried a story which began as follows last week:

Britain’s biggest banks are facing an unprecedented people’s revolt as millions of ordinary customers prepare to claim back illegal charges. Internet-based campaigners plan to use the annual bank profits reporting season, which takes place over the next fortnight, to trigger a massive round of complaints about unauthorised overdraft charges.

Thousands of customers have already won compensation since an Office of Fair Trading ruling last April, which caused panic among leading banks. The OFT said penalty charges in the credit card industry were illegal and warned it would investigate almost identical fees levied by banks. The regulator is expected to announce its verdict within weeks.

It’s a shame Australia doesn’t have a more vigilant consumer movement and a regulator who was prepared to take on the banks rather than work for them.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey