THE South African public are on their own when it comes to a fight against injustices committed by the all-powerful banking industry.
This is according to financial investigations consultant Emerald van Zyl, who commented on the ongoing story about how the banks in the country abuse their powers in their relationship with clients.
The banks are constantly criticised for willy-nilly shutting down banking accounts of clients, their decisions based on unfounded allegations often characterised by the sector as ‘reputational risk’.
Van Zyl, who has been fighting against wrongful practices by the banks for more than 20 years, held a view that banking consumers were on their own because the regulators, charged with holding the banks accountable, “are all corrupt”.
“The government controls the banks and they won’t do anything,” he said.
Van Zyl shared the sentiment recently expressed by the outgoing commissioner of the South African Competition Commission, Thembinkosi Bonakele, who depicted a picture of the too powerful banking sector that skirts being held accountable for their actions.
In a recent interview with the SABC, Bonakele said: “It is a very powerful sector but also regulators traditionally have been quite conservative in their approach to hold financial services accountable … You can be reasonable in your approach but expect people to comply with the law.”
He said some years ago the Commission conducted an inquiry into the banking charges and that “most people couldn’t even imagine that you can question the price that the banks impose”.
He said banks impose exorbitant banking fees. “If you fail to make payment to your creditor through a stop order they essentially punish you,” he said.
He frowned upon the banks’ behaviour to act like a government and punish their clients by imposing high banking charges for non-payment.
“Even the state can’t prosecute you for failing to pay your debts. But the banks could impose a penalty on you for this. They almost stand at this (powerful) position where they enforce the rules in the financial environment and transactions,” he said.
Van Zyl expressed a sense of hopelessness as to whether the government of the day could do something to protect consumers from the all-powerful banks.
He said: “I really don’t know if there is something that can be done. I have been fighting this for 20 years. First, it was the (Afrikaner) Broederbond and now the ANC. And the political parties won’t step in because the banks are financing them.”
He has for years highlighted the fact that black people are discriminated against by the banks based on their racial profiling.
His recent comments were made on the back of a Standard Bank notice of intention to close down the Independent Media’s banking facility.
Independent Media is set to challenge Standard Bank’s business decision in court later in August.
Commenting on Standard Bank’s action, Cosatu spokesperson Sizwe Pamla said: “Standard Bank is not a banking regulator, the Reserve Bank is. The Competition Commission has complained about the banking sector’s unethical behaviour, so banks cannot give themselves the power to choose who to work with and not work with. This is a slippery slope for our democracy and media freedom.”
The latest report by the Prudential Authority (PA) of the South African Reserve Bank has flagged the manner in which the banks go about terminating banking accounts. In the case of suspicious or illegal activities, for example, they do so before they report the alleged anomaly to the Financial Intelligence Centre, as is required by law.