Ruined by ANZ Bank

Rob Willmott’s Story

My name is Robert Willmott. I am one of the ANZ Bank’s victims who have attempted to protect our rights under our contract with the bank without success. My experience with the bank and the regulators suggests the bank did not act in good faith in our case from the beginning of our loan period.

I was a Landmark customer for 10 years before it was purchased by ANZ bank (‘ANZ’). During that period, I always complied with the loan agreement and never missed a payment. In late 2009, when ANZ purchased Landmark’s loans, we had no banking services and our banking contract with ANZ only settled down towards the end of 2010. When the new bank manager was appointed, our loan contract was significantly reduced, and our successful cattle trading enterprise was shut down.

The decision by ANZ contrasted with its responsibility under our loan contract, as our debt-to-equity relationship was less than 50%, and it substantially starved our revenue and effectively shut our business down. This was not the reason why we were borrowing funds from the bank; we needed trading funds to generate earnings. The new manager did not have the training or experience to manage a farming business like ours and when he called in our trading loan with 30 days noted we went into default.

Having taken away from us the funding we required to continue trading profitably, ANZ forced us into selling our farming lands and assets, which meant for the next few years we were struggling to survive. I had to change my work plans which had proved successful for the last 15 years and obtained employment at Mount Newman mines, and our family business was destroyed.

Prior to Royal Commission, we went to Perth and explained the position my family was in, but no action was taken. At about that time, there was a lot of media coverage about how the bank was using the police to foreclose on farms. My family decided to survive what appeared to be one of the most disgraceful periods in the Australian banking industry and without our family’s support, we would have lost all our property and assets as a result of the way ANZ treated us.

I now believe this should not have happened and that ASIC had a responsibility to protect my rights. I have discussed this with people who attended meetings at Parliament House in 2018 and 2019 and I believe ASIC was not an honest cop because it claims it cannot act for any individuals, which has been the case since self-regulation was introduced by banks in 2003.

I believe that ANZ had a duty to advise me of my rights under the 2004 Code of Banking Practice (‘the 2004 Code’) and the AS 4269-1995 Standard, which were an essential part of our loan contract. The bank, its directors, and its licensee had not complied with the internal dispute resolution procedure in the Code, which stated banks must resolve disputes free of charge (clause 35.1(a)). The bank and ASIC knew this but were involved in deception by omission when keeping this information from me.

The deception by omission occurred throughout my dispute period. The Code, in clause 35.1(b), noted leading legal minds at this time had published the essential elements of effective complaint handling in the AS 4269-1995 Standard. As I did not have access to this document, ASIC took no action when it must have known that ANZ could deceive me when I was attempting to resolve my disputes.

And following are details of my story:

My family has owned and operated the farm at “Four Mile Hill” since 1900. In 1998, I acquired Four Mile Hill from the family and borrowed approximately $2M. From 1998 to December 2009, I had debt facilities from Landmark, and, during that time, I met all interest repayments in full and on-time.

Mid 2003, I acquired another farm at Scott River with the notion of developing it for sale. One of the properties was sold in 2005 at a considerable profit, which was then used to service debt and fund improvements to the Four Mile Hill farming operation.

I have been involved in the sand and extraction industry for 20 years. I selected properties with gravel reserves and potential for extraction, to increase overall profitability and cashflow.

On 12 February 2004, I received a Landmark letter of offer for $1M. The security is taken as the first-ranking mortgage over rural property and bill of sale over cattle.

And 3 weeks later, we received another Landmark’s offer for a $400k Seasonal Facility.

On 10 November 2004, as Director, I received Landmark’s offer for a $50k facility.

On 31 January 2005, I received Landmark’s offer of $2.75M. The next day, I received an identical offer.

In August 2005, I purchased a farm neighboring Four Mile Hill. The acquisition was to be funded by the sale of two properties, with the balance being an interest-only loan provided by Landmark. The overarching plan was then to repay the loan in full, from proceeds of the Layman Road development.

At the same time, I owned a 100 ha block on Layman Road that was situated within 2km of Busselton CBD. This property had significant development potential, for which offers were received from developers, that were over and above our total loan value with Landmark. With support from the State planning commissions and Landmark, I commenced rezoning the lot to residential. Agricultural rezoning was a less onerous form of subdivision. The rezoning could take up to 5 years to complete, which was factored into cashflow forecast and budgets that supported the Landmark loans. Furthermore, Principal of Action Real Estate in Busselton, estimated that once the Layman Road rezoning was complete, the value could be in the vicinity of $9M to $12M.

On 22 September 2005, I received a Landmark loan terms letter for a recent application for increased budget limits, relating mainly to interest rate options, along with enclosing the Original Letter of Offer, Copy of the Letter of Offer, and Settlement Authority for Signing.

On 14 December 2006, I received a Landmark Letter of Offer extending the $50k budget limit to 31 October 2007.

In January 2009, the second Scott River property was sold at a considerable profit.

On 16 September 2009, I received an email from Paul Torrisi of Landmark outlining his notion of the cashflow forecast assumptions. Among other things, the email notes the limit (assumed credit) of $11.8M with cashflow peaks at $13.5M (i.e., extra $1.7M), operating surplus of $840K, the interest of $920K, and machinery repayments of $133K.

On 14 October 2009, we received a Landmark letter of variation. The letter noted a total amount of credit of $13.5M.

On 8 December 2009, ANZ acquired the Landmark Loan and Deposit Books. From this date, ANZ provided no support, didn’t understand our situation, didn’t provide a banking manager for many months and, when they did, implemented a rapid debt reduction plan requiring all funds from land sales, cattle sales, and asset sales to be utilised to repay ANZ debt.

On 19 October 2010, I received an email from Garry Harvey from ANZ in relation to the cash flow forecast and budget for the 12-month period to 30 June 2011.

On 21 December 2010, I received ANZ Letter of Offer for a $4.2M Revolving Agri Line, interest rate currently 9.26% pa and the term ending on either or both a Review Event and an event of Default; $2.5M business Loan (Fixed Rate); $5.8M Business Loan (Variable Rate); and $500k Business Loan (Variable Rate); along with a $5.SM Business Loan (Variable Rate); and $500k Business Loan (Variable Rate) both with only a 30-day expiry period. To raise 6.3 min 30 days over the Christmas period was impossible. It is our belief that this was a deliberate act to put us into default resulting in increased interest rates and bank charges, not to mention the mental and emotional stress this caused (21 December 2010, 4 days before Xmas-Letter of Offer from ANZ Bank)

I believe ANZ set us up to fail, as it was not realistic to formally list $8M worth of individual lots within a month nor was it appropriate for them to advise on what land assets to sell i.e. the bank was not providing formal advice on what was the most feasible properties to sell to reduce debt. Providing a monthly term for facilities totaling $6.3M appears counter-productive and costly, with a loan term reflecting realistic times to achieve the land sales, as per the overarching strategy, potentially more reasonable.

It took ANZ more than 6 months to provide the 1-month loan and it didn’t understand their business, nor did they provide any support.

On 1 February 2011, ANZ issued a Notice of Default. On 16 March 2011, we met with ANZ, at our farm. The meeting was to discuss options to extend debt facilities, with the following to be provided prior to 31 March 2011, including revised Cashflow forecast to 31 December 2011; detail of projected inflows and outflows; statement of financial position; update on listed assets and confirmed sales thereof; provision of signed 2010 financial statements and tax returns; debtor, creditor and ATO balance reports as of 31 December 2010; accountant prepared Interim financial reports to 31 December 2010; detail of cattle trading, gravel and sand excavation and cropping operations; and ANZ seek to take out life policy mortgage as security too.

In April 2011, we were forced to sell all cattle, due to ANZ pressure. As per our 2011 accountant-prepared financial statements, a total of 4,015 Cattle were sold for $3.9M which left only 15 cattle on hand as of 30 June 2011. There were 2,956 cattle on hand as of 30 June 2010. Further, we had a substantial forward contract on cattle and were forced, by ANZ, to sell cattle that we had only just acquired, which also meant that we could not fulfill the forward contract requirements. This resulted in material financial losses.

On 7 July 2011, we received ANZ’s letter of offer for Agri Finance, Revolving Agri Line, and Business Loan facilities. The facilities totaled $12.1M with a 12-month loan term on the $11.1M loans and no expiry on the $1M overdraft. The overdraft limit had been reduced from $4.2M to $1M, which meant that we had less short-term cash funding available. The interest and fees were significantly higher than that of Landmark. There was a significant amount of financial and non-financial covenants that had to be adhered too.

In December 2012, we received notice of failure to perform from ANZ. Further, the proposed sale of Lots 283 and 801 Lindberg ultimately failed due to not being able to fund (ANZ would not provide funds) the provision of power to the lots.

On 6 June 2013, we received ANZ’s Notice of Arrears. One month later, we received ANZ’s notice of arrears and failure to perform.

On 27 November 2013, we paid out all ANZ facilities and refinanced with Rural Bank, with the support of a $1.5M loan from family.

ANZ did its own analysis of the property sales and concluded that they were not undersold. ANZ claimed that the properties were sold for $591k more than the most recent valuations.

We had to sell off contracting plant and equipment, to fund ANZ’s demands, which meant we would no longer be able to extract gravel or sand.

On 31 December 2021, David Neve & Associates (Agricultural & Management Consultants) Issued a report to us, comparing 2009 Hegney Property Valuations against Actual Sales Prices (‘Neve Report’). Neve Report compared the realised property asset sales prices, from March 2011 to November 2013, against the 2009 Hegney market valuation reports prepared for the same. The Neve Report concluded that we had lost $3.9M (including interest), due to property assets being undersold from claimed pressure from ANZ. As of the time of this report, we are still in dispute with ANZ.

ANZ damaged our business by doing the following:

• • providing pure asset or ‘predatory’ loans without considering serviceability requirements.
  • providing short-term high interest-bearing loans not suited to our circumstances, not in our best interests, and not suitable for the underlying assets.
  • creating various debt facility breaches by way of not being a prudent and diligent lender and overall incompetence due to a lack of understanding of the overarching business development plan.
  • bullying, intimidating and putting undue pressure on us
  • breaching the loan contracts by withholding documents pertinent to our rights.
  • not acting in good faith or ethically when, which caused material losses in lost trading, under sale of assets, and lost opportunities.
  • causing material financial losses and irreparable reputational damage.

The forensic accountant’s financial loss report states that the result of the assessment of my net past financial loss is $28.2M on a pre-income tax basis.

In February 2018, we met with ANZ to discuss issues we experienced during our period of banking with ANZ, following the ANZ takeover of the Landmark loan book. After the meeting, we wrote to Ben Steinberg in May, stating that at the conclusion of the meeting we were told that our case was being referred to higher management for review and that ANZ would be in touch soon. Given that we have had no contact over the 11 weeks since the meeting, we have decided it appropriate to forward a copy of the major items raised and discussed during the meeting, noting:

1. 1. Eight-month delayed representation by ANZ following Landmark takeover. Following the ANZ takeover of the Landmark loan book, there was an approximate eight-month period between December 2009 and June 2010 when we had absolutely no bank representation with either our previous Landmark contacts or new ANZ management.
   2. Loss of our banking file. In our first meeting with ANZ bank manager Garry Harvey in mid-June 2010, he greeted us by stating that ANZ had “lost our Landmark file” during the Landmark takeover. This was confirmed by Ben Steinberg at the 13 February 2018 meeting. The ANZ did not explain how the ‘file’ was lost, nor was there any explanation as to why there was no hard copy or electronic backup of the information contained within our file. We believe that our file has been purposely ‘misplaced’ owing to specific content that would be damaging for ANZ given their actions.
   3. Lack of clarity regarding new ANZ terms and our legal rights. We were unaware that we had any option other than to sign the new agreements with ANZ. At no stage did ANZ advise or recommend we seek an independent legal opinion regarding changes to our existing loans with Landmark (Al0/10).
   4. Lending structures. Sharan Safe (ANZ) claimed that Landmark was operating under different lending structures (compared to ANZ), and this justified implementing dramatic debt reduction across our operations.
   5. Unjustified and unrealistic debt reduction goals. Approximately eight months following the Landmark takeover and six months from ANZ interim accounts being opened, we received a written demand to reduce debt by $6.3 million within 30 days (by 31 January 2011) along with a further condition for $8 million worth of land to be listed within four weeks. This target was both unjustified (given that we had never previously defaulted on a loan repayment in the history of our farming operations), and unrealistic property prices had declined significantly due to an oversupply of farmland being placed on the market by other farmers with similar demands from the ANZ). In the 13 February, 2018 meeting Andrew Mclaughlin stated that our “asset should have been valued at $24 million, not the $16 million assessed by ANZ”,
   6. Contradictory advice from ANZ personnel, with confusion continuing in 2018. In December 2010 we received a letter of demand from ANZ forcing us to reduce our debt by $6.3 million within 30 days (by 31 January 2011) along with a further condition for $8 million worth of land to be listed within four weeks. In March 2011 Keith Weybury told us that he didn’t want us to move too fast with land sales because market prices had been so damaged by a large number of impacted farmers. Roland Davis then told us not to take any notice of Keith and Lou, and to sell as quickly as possible. The confusion continues in 2018 when Ben Steinberg emailed Andrew Mclaughlin on 21 January 2018 and stated, “a cursory review of the matter indicates that there was no enforcement by ANZ and that the Willmott’s undertook voluntary asset sales and repaid the Bank before moving on”.
   7. ANZ’s strategy to remove all cash flow. In addition to marketing land, ANZ insisted on selling all cattle within the feedlot to further reduce debt rapidly. The ANZ then refused to provide ANY capital to restock, even though we had significant supply contracts on offer including over 5,000 head of cattle worth $3 million (income lost over a 12-month period). This removed the bulk of our cash flow and eventually forced us to default on loan repayments …… for the first time ever! We had offers from Vanessa’s father and brother to inject cash into the business to buy cattle required to secure the feedlot contracts, but this was also rejected by the ANZ. We had spent the previous three years heavily investing in building the feedlot infrastructure and developing associated markets.
   8. Bully tactics by Roland Davis. After the forced sale of cattle within our feedlot, refusal to fund restocking to secure future contracts, forced sale and marketing across the majority of our asset base, and subsequent loan defaulting for the first time in our history of operation, we received a request from Roland Davis to increase our life insurance policies.
   9. ANZ ‘clawback’. We consider ourselves to have been an ANZ ‘clawback’ as per ANZ letter of offer 1. The altered loans and associated conditions forced our business into a position where it was unable to trade.
   10. The First Letter of Offer in December 2010 confirms ANZ was indeed in the wrong. Landmark gave a further advance to Willmott nine months prior to ANZ Bank’s first letter of offer on 21 December 2010. The Landmark loan and conditions extended through to 2016. The first letter of offer from Garry Harvey of ANZ had a cover page that said “NORMAL – The loan agreement confirms the extension of existing banking facilities and includes a condition for you to identify lots that can be sold to reduce debt to a more manageable level.” The letter of offer then specifies a reduction in debt of $6.3 million within one month, with a condition for $8 million worth of land to be placed on the market within the same time frame. The cover letter actually contradicted the offer being made.
   11. In the 13 February, 2018 meeting Ben Steinberg was unsure what the previous loan arrangements were with Landmark, as ANZ had lost the file. Ben suggested that the first ANZ letter of offer likely reflected the existing Landmark facility. Rob confirmed that this certainly was not the case. Ben said he would be going to have another look for the Willmott Landmark in the archives but could not promise that it would be found.

But we again did not receive any response from the bank.

We have reviewed our documents and found that there is evidence that the bank damaged us by not complying with many clauses in the 2004 Code as listed follow:

• • not providing effective disclosure of information (Clause 2.1(b)(i))
  • not providing information to you in plain language (Clause 2.1(d)
  • not acting fairly and reasonably towards customers in a consistent and ethical manner (Clause 2.2)
  • not complying with all relevant laws relating to banking services (Clause 3.1)
  • not ensuring its staff (and its authorised representatives) to be trained so that they have adequate knowledge of the provisions of this Code (Clause 7(b))
  • not applying to the internal process for handling disputes with customers which is free of charge (Clause 35.1(a))
  • not meeting the standards set out in Australian Standard AS4269-1995 or any other industry dispute standard or guideline which ASIC declares to apply to this Code ((Clause 35.1(b))
  • not adhering to the timeframes specified in this clause 35 ((Clause 35.1(c)), and
  • not providing written reasons for its decision on a dispute ((Clause 35.1(d))

I attempted to explain the serious allegations of misconduct and practices by these banks which were more serious than the practices by Bernie Madoff, who was America’s greatest fraudster. However, I have not received any response nor an explanation of why the banks destroyed my business and my family’s life.

I will keep going filing complaints until the banks provide me with fair compensation and an apology.