Category Archives: Scams and Scammers

His only crime? Getting Caught

Thank you Australian Financial Review for this article – 07 July 2016 – A former Aussie Home Loan broker would go to jail for up to a year after admitting he submitted fake home loan applications to Westpac, National Australia Bank and ANZ Banking Group at least 18 times.

Aussie Home Loan mortgage broker Madhvan Nair admitted on Thursday making 18 loan applications totalling $5.6 million between 2012 and 2014 which had false borrower employment documents.

Of the 18 loan applications, 12 were approved by the banks, which resulted in home loans worth $3.7 million.

Mr Nair pocketed $10,000 in commission and cash payments for making the false loan applications.

I have said for a long time that this is an epidemic. A dark undercurrent of lies and deception that is NOT being thoroughly investigated by the lenders despite the fact that they KNOW its an epidemic!

These practices are silently contributing to the severity of the ultimate correction that is now long overdue.


Overheard a couple in their 20’s talking about Mortgages, so I waded in and told them a little of my background.  We chatted for a while and he pulled out a letter from his Lender.

$450,000.00 loan over 30 years at about ca. 4.5 or 4.6% INTEREST ONLY for 3 years, about to revert to PRINCIPAL AND INTEREST at >5.3%.  Neither of them had ANY IDEA what those terms meant or how it affected them, and they certainly did NOT understand why their Mortgage repayments were jumping from around $1,720 per month to $2,500.00 per month in a couple of weeks. NO IDEA at all.

Since they had borrowed through a Broker, she had had a baby and gone part time AND they had signed up for a brand new car at Dealer finance, which was not, in any way, a “friendly” deal as had been promised!

I brought up a Loan Calculator online and asked them what their circumstances were at the time they took out their loan.  OH DEAR!  The BEST I could come up with was $350,000.00, certainly not $450,000.00.  I told them about suspect Brokers who were inflating people’s circumstances, as well as Banks bad lending practices that were “setting people up for failure” down the track.

They got quite angry – not at me, but left, RAGE ON, ready to question  both Broker and Lender with the list of ‘please explains” I’d provided.

Here it comes folks – all these bullshit loans made before the Banks were forced to tighten lending criteria are coming home to roost.  This couple are screwed and will have to hand back their car, or sell their home.

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There are scammers everywhere and none worse than those who would promote a scheme to you promising untold wealth for little or no outlay.  Such as the scumbags who telemarket NRAS (National rental Affordability Scheme) properties to those who may have the wherewithall to purchase through their SMSF (Self Managed Superannuation Fund).

Reproduced below is a WARNING from ASIC (Australian Securities and Investments Commission).

Tuesday 22 October 2013

ASIC is today warning consumers about advertising that promotes the use of self-managed superannuation funds (SMSFs) to invest in residential properties through the National Rental Affordability Scheme (NRAS). 

NRAS is run by the Australian Government in partnership with the states and territories to promote investment in affordable rental housing. The scheme offers direct payments and tax offsets for building and leasing housing to low and moderate income earners at a rate that is at least 20% below the market value. 

ASIC is aware that a number of SMSF promoters include misleading statements in their ads about the grants that may be available under NRAS. 

ASIC has seen ads stating that consumers can use their superannuation to purchase a property using the scheme and receive ‘$100,000 tax free’. 

These ads do not provide balanced messages about the features, benefits and risks of investing via an SMSF in an NRAS property. Such ads should make clear to consumers:

  • that eligibility to participate in the scheme is subject to restrictions
  • the likely fees associated with purchasing, tenanting and managing properties purchased from NRAS-approved participants
  • that to receive a total financial incentive of $100,000, consumers will need to remain in the scheme for 10 years, and
  • that they will be required to rent out the NRAS property at 20% below the market value to eligible tenants.

NRAS aims to encourage larger scaled property investments (usually 100 or more houses). However, individual investors can access the scheme through an approved participant. The Department of Social Services publishes monthly reports on its website which contain the names of NRAS-approved participants.

SMSF investors should be aware that: 

  • if you are considering purchasing an NRAS property through an approved participant, there is no requirement for the incentives to be passed on by the approved participants to you
  • the payment of the incentive to the approved participant is dependent on compliance with specific conditions
  • there are likely to be fees associated with purchasing, tenanting and managing properties purchased from NRAS-approved participants, and
  • any contractual arrangements in place should be checked to ensure that the relevant NRAS-approved participant will comply with all legislative requirements.

A person recommending that you make an investment through your SMSF will generally need to hold an Australian financial services licence. If you are approached about using an SMSF to invest in an NRAS property, or any property for that matter, check that the person you are dealing with is licensed to provide financial product advice by searching ASIC’s public register of AFS licensees or authorised representatives: see ASIC’s connect online. You should also do your research and consider whether the investment is appropriate for your retirement objectives.

‘ASIC is focused on protecting consumers and where we see people recommending consumers invest using their SMSF we want to ensure they are providing balanced messages that comply with the law,’ ASIC Commissioner Greg Tanzer said.

‘It is important that ads are clear, accurate and balanced, especially when consumers are looking for investments for their long-term retirement,’ Mr Tanzer said.

‘Consumers need to be cautious when presented with claims which appear too good to be true and should do their research before investing. Consumers should think carefully about how long they intend to hold the NRAS property, ensure that they understand the income and capital potential of an NRAS property and satisfy themselves that it fits with their investment purpose,’ Mr Tanzer said. 

‘An NRAS property may not be suitable for everyone. Those who recommend any form of investments through an SMSF must be authorised to do so under an AFS licence and provide appropriate financial product advice that is in the best interests of investors.’



Should I gloat? I’m going to anyway.  A real clever fellow screwed me out of a fair sum of money many years ago and gloated over the fact.  I gave up, settled out of Court for a lot less than he owed me but….I knew he would get his.

At the time he boasted about the purchase of a very expensive piece of land (that I’m sure had MY money in it too!) and further crowed about the equally expensive house he built upon that land.

Well, Karma came in the shape of the GFC and I’ve just learned that he flushed about a million bucks.

Time for a gin and tonic!

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G’Day again and thanks for dropping by.

I’ve taken a peek at a particular street where I marketed and sold a LOT of homes in 2002-2004.

When the market was crazy I was personally selling 2 houses a month in this one street.  In the last two years there have been just 12 sales.

Bought March 2008 for $469,000.00 sold Dec 2012 for $415,000.00.  That’s a loss of $80,000 on the surface but I know they put a very expensive block wall around the back yard, renovated the kitchen, re painted and re carpeted. Mmmmm – they ‘probably’  flushed $120,000.00

Bought August 2006 for $410,000.00. Sold late 2012 for $450,000.00 WHOO HOO – a profit!  Sorry, NO. The stamp duty and legals going in and the real estate agent and other fees going out mean that for SIX years of blood sweat and tears it returned them ABSOLUTELY NOTHING.

Bought late 2005 for $395,00.00.  Sold late 2012 for $465,000.00  MORE CHEERING I hear! BONG, CLANG, SMASH…  Not if you put an extension on the house, re paint inside and out, new expensive window finishings, new carpet and tiles. Take out stamp duty, legals, agents fees and we have another LOSER.

Bought September 2003 for $310,000.00 and SOLD late 2010 for $450,000.00.  THE ONLY WINNER here.  Good timing.  However, the sale was made by a very dodgy marketing company that took them to the cleaners on fees and questionable marketing expenses but they still did OK.  Or did they?  It cost them $340,000.00 to get in – they “owned” together with the Bank for SEVEN YEARS where they had a series of really bad Property Managers who put terrible tenants in place.  They paid out a fortune in routine and extraordinary maintenance and had to refurbish the gardens three times at huge expense as packs of large dogs had ripped it to shreds. They were charged more than $30,000.00 in sale fees so they netted about $80,000.00 less capital gains tax. Depending on their personal tax circumstances they ‘made’ about $7,000.00a year for all that grief and heartache.

The new owners are also far from happy.  They are from interstate and were also duped by the same dodgy marketers.  They could have bought the IDENTICAL house about ten doors down for $380,000.00.

Turning to the beaches here – WHAT BEACHES?  If we get a couple of bad winter storms where the surf gets much bigger than 6 feet, we will start to see swimming pools and possibly $5 million+ homes and apartments fall into the ocean.  I am not kidding.   Google “Beach Erosion Gold Coast Queensland Australia” and see for yourself.


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I still shake my head when I read and hear Real Estate Agents and Auctioneers spruiking their fabulous clearance rates and climbing median prices. As I’ve said many times, you have to take all of this spin, and that’s all it is, with a grain of salt.  Do your research, find out what really went on behind the scenes of every single sale, but I digress…

Even with very low interest rates, levels of mortgage stress are slowly rising and there is one big reason for a few hundred thousand of these distressed folk – LIES!

This is not a Mortgage Broker bashing exercise – remember why I write this blog please.  It’s to open your eyes to the many and varied sharp practices out there and urge you to be constantly on your guard.  It doesn’t mean everyone is out to get you, but it pays to put your big girl panties on when you start the process of buying (or selling) property.  This bit is about buying and again, for the umpteenth time, why would you unless it’s the bargain of the century.

Back to (some) brokers then who are so hungry for a deal that they’ve been and continue to prostitute themselves and commit gross acts of fraud upon their clients and the Bank to get their commission.  Noticed I said ‘get’ and not ‘earn’.

In the normally pretty swanky Broker’s Office applicants put down that they are a factory worker and administration assistant. Earnings are $30,000 and $26,000 a year respectively.  They sign and shake hands with their friendly, smiling Broker, and leave.  The greedy Broker then ‘doctors’ the documents and the applicants magically become a teacher and professor on many times the income formerly stated and the application is (naturally) approved by the Bank (that pays the Broker maximum up front omission and trail).  This would be dangerous enough in and of itself but it gets worse.  Because the income and expenses have been fudged so much, the hapless couple are told, when they return to the Broker’s lair, that they’ve qualified for an additional $100,000.00 and can afford to go upmarket and buy the home of their dreams.

Of course the couple are not financially savvy and rely on the Broker to tell the truth – sorry that went through the shredder along with their original application.  The broker has also arranged for the Loan to be low start and interest only for the first 2 years.  The couple don’t have a clue what he’s talking about and only look at the LOW weekly payment they have to come up with to buy the House of Their Dreams.

Many people who bought like this have been “rescued” so-to-speak if they bought pre 2001 and their property values have skyrocketed and interest rates have fallen significantly – in many cases a ‘rescue” refinance kept them afloat.  Exploding rents also helped.

However, since about 2003 – 2004 this has been and will continue to be an unmitigated disaster for those trapped by dodgy Brokers.

Estimates as to the number of LIE LOANS, as I call them, vary wildly because the brokers aren’t saying and the Banks… well they’d be stupid to say, anything, unless forced to by a Royal Commission or the like.  We are seeing some action against Brokers and Banks in Court but that is expensive, time consuming and from my checking around, is producing varied results.

Moral?  As always, do your homework.  educate yourself.  And do NOT listen to workmates, family or friends unless they have bought and sold a dozen or more properties and have great accountancy and tax skills.  Advice from them is akin to talking to your chickens.

Still determined to buy – talk to me first – my fees are reasonable and I will tell you the truth.

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A house nearby just sold after being on the market for months, for a loss of more than $100,000.00 after 7 years of “ownership” or really having a putrid relationship with a bank who “allowed” the poor “owners” to occupy the property.  I know a little of this place and its distraught former owners.

Their total out of pocket expenses in bank interest, rates, building (not including contents) insurance and repairs over the 7 years amounted to roughly $215,000.00

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On the 6th November I wrote on solar power.  Please see Archives November under Solar Schmolar.

I’ve been warning people ever since the Government introduced the scheme that there were traps for all.  The Contracts covering rebates, credits and prices for power sold back to the grid had hundreds of conditions.

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Sadly a fair number fit into the heading’s description.

On Site Managers, or the Owners of Management Rights (OSMs I’ll call them) in Complexes fall into a wide number of categories.  I’ve worked with some, butted heads with others, been subjected to their lack of professionalism and incompetence as a tenant, and watched as they’ve been caught cooking the books.

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