If you’ve ever taken out a home loan, you know just how much trust you’re placing in your lender.

After all, for most Aussies, a mortgage is the most significant financial commitment we’ll ever make.

So, it’s more than a little unsettling to hear that one of the country’s best-known lenders, RAMS (owned by Westpac), is now at the centre of a significant legal storm over alleged systemic misconduct in its home loan business.

The Australian Securities and Investments Commission (ASIC), our national corporate watchdog, has launched legal action against RAMS, accusing the lender of widespread failures in its supervision of franchisees.

ASIC sues Westpac-owned RAMS over systemic home loan misconduct using fake documents and altered data. Credit: Depositphotos

According to ASIC, between June 2019 and April 2023, RAMS staff and franchisees engaged in a range of dodgy practices, including:

• Submitting fake pay slips as part of mortgage applications
• Fiddling with customers’ debts and expenses to make them appear more eligible for loans
• Even manufacturing fake contracts of sale for homes

These aren’t just minor slip-ups. Loans based on false or exaggerated information—sometimes called 'liar loans'—can put borrowers at serious risk, not to mention undermining the integrity of the whole financial system.

If you’re wondering why this is such a big deal, consider this: when lenders approve loans based on dodgy paperwork, it means people might be getting mortgages they can’t afford.

That’s a recipe for financial stress, defaults, and even losing your home. Plus, it can drive up costs for everyone else as banks try to cover their losses.

ASIC’s deputy chair, Sarah Court, didn’t mince words, calling it a 'systemic organisational governance failure' and saying RAMS 'allowed years of unlawful conduct to occur across its franchises.' Ouch.

In August 2024, Westpac announced it would close RAMS to new home loan applications, folding its existing loans into the broader Westpac group.

So, if you already have a RAMS loan, you’ll still be looked after—but the brand itself won’t be taking on new customers.

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Westpac has said it’s set aside enough money to cover any penalties or compensation that might come out of the court case, and RAMS has admitted liability and already started compensating affected customers.

This isn’t the first time the use of 'referrers' or 'introducers' has come under fire.

The Banking Royal Commission previously slammed similar programs at other banks, where unlicensed third parties were paid to bring in new business—sometimes without proper checks or oversight.

ASIC alleges RAMS also dealt with unlicensed referrers, raising more questions about how widespread these practices might be across the industry.

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If you have a RAMS home loan, there’s no need to panic—but it’s a good idea to:

• Review your loan documents and make sure everything looks above board
• Contact RAMS or Westpac if you have concerns or think you might have been affected
• Keep an eye out for any communication about compensation or changes to your loan

And if you’re shopping for a new home loan, always double-check your lender’s credentials and don’t be afraid to ask questions about how your application is being handled.

This case is a timely reminder that, even in 2024, we can’t always assume our banks and lenders are doing the right thing behind the scenes.

It pays to stay informed, ask questions, and maintain accurate records of your financial transactions.

Key Takeaways

• ASIC is taking legal action against Westpac-owned RAMS, alleging the brand engaged in systemic misconduct in arranging home loans, including use of fake documents and altering customer information.
• It’s claimed that RAMS failed to properly supervise its franchise network, leading to years of unlawful behaviour such as 'liar loans' being issued to unqualified customers and boosting franchisee commissions.
• RAMS has admitted liability for these breaches and says it has already compensated customers who were affected by the misconduct.
• Westpac has closed RAMS to new home loan applications from August 2024 and says it will work with ASIC to resolve the matter, expecting current provisions to cover any penalties.

Have you ever had a strange experience with a lender, or do you have concerns about your home loan? We’d love to hear your stories and tips—share your thoughts in the comments below, and let’s help each other stay savvy and safe in the world of finance!

 

[DLHM]

I’m sure RAMS isn’t alone in misconduct. Will the ASIC have other dodgy home loan companies to uncover?

 

[darrellh]

You can lose your home quickly enough with interest rate rises etc but when you actually can't afford to sevice the loan in the first place you can be forced to sell your home and end up losing lot little equity you had in the home in the first place or selling at a loss. That is criminal and when the dream of owning your own home outstrips your own common sense as well.

 

[Squizzy1]

The whole Financial Industry is a joke, and a law unto itself, the Banking RC proved shonky practices were rife, and clearly this was being practiced right throughout and after. There were no consequences following the RC, no raids, no charges, not one arrest, just some piddling fine they soon recouped from their victims, imagine if this was a Union, it was a laugh imo. They just picked up from where they left off and carried on as usual money laundering and all imo. I understand the Govt at the time were in the Bank's pocket, hell from memory the Govt refused a RC two dozen times, but how come having the evidence no one was held responsible, the CEO's probably got a pay rise as a reward for a job well done, and the Govt. continued to back them, a law unto themselves.

 

[Squizzy1]

I’m sure RAMS isn’t alone in misconduct. Will the ASIC have other dodgy home loan companies to uncover?

The whole Financial Industry is corrupt imo.

 

[Radiant]

How selfish people are. As if the Banks are not syphoning enough from us already. Criminal to think our homes could come under threat by these irregularities. Gone are the days when we could seek support and advice from our trusted and friendly Bank Manager. It’s an inditement of how low the once trusted level of our society has reached

 

[BJM]

I too had a “dodgy” home loan with figures that were “jiggled” so the application could be approved. Years later after my partner passed I tried to have my loan reassessed into my name only and was refused. I was told I couldn’t have a mortgage in my name only as I was on an age pension an to pay the loan out or the bank would sell my house. I had been with this bank over 25 years. The bank preferred to keep the loan as it was with my deceased partners name on it. I was fully aware this was unlawful and advised as such. “They were going to sell my house”. I immediately referred the matter to the Ombudsman and things changed quickly. Not only was the loan was changed to my name only but the interest rates were lowered. It pays to get advice….

 

[Tipsy]

All the big banks are involved with this sort of thing, C'mon they create the money for your home loan is created out of THIN AIR... In other words the so called money does NOT EXIST its FALSE MONEY... So why do you have to pay REAL MONEY back to these criminals

 

[Cheezil]

The whole Financial Industry is a joke, and a law unto itself, the Banking RC proved shonky practices were rife, and clearly this was being practiced right throughout and after. There were no consequences following the RC, no raids, no charges, not one arrest, just some piddling fine they soon recouped from their victims, imagine if this was a Union, it was a laugh imo. They just picked up from where they left off and carried on as usual money laundering and all imo. I understand the Govt at the time were in the Bank's pocket, hell from memory the Govt refused a RC two dozen times, but how come having the evidence no one was held responsible, the CEO's probably got a pay rise as a reward for a job well done, and the Govt. continued to back them, a law unto themselves.

A bit like supermarkets, utility providers, phone/internet providers & probably many other big business/wealthy companies, politicians, court system, etc!

Working class have no hope of getting ahead when there's so many legalised sharks robbing us blind at every opportunity & no one prepared to stop/change things

 

[Leenie]

How selfish people are. As if the Banks are not syphoning enough from us already. Criminal to think our homes could come under threat by these irregularities. Gone are the days when we could seek support and advice from our trusted and friendly Bank Manager. It’s an inditement of how low the once trusted level of our society has reached

They say there’s a fool born every minute.

 

[gordon1940]

I’m sure RAMS isn’t alone in misconduct. Will the ASIC have other dodgy home loan companies to uncov

I’m sure RAMS isn’t alone in misconduct. Will the ASIC have other dodgy home loan companies to uncover?

As a Retired Banker and Financial Planner, I have been aware of VERY dubious practices in completing Loan applications for many years. However these practices are carried out mainly by Finance Brokers who "fiffdle" Assets/Liabilities and Income/Expenditure figures in an endeavor to obtain Bank Approvals and therefore Commissions.

 

[marni]

As a Retired Banker and Financial Planner, I have been aware of VERY dubious practices in completing Loan applications for many years. However these practices are carried out mainly by Finance Brokers who "fiffdle" Assets/Liabilities and Income/Expenditure figures in an endeavor to obtain Bank Approvals and therefore Commissions.

I think a lot of those applying for a loan are well aware of the fiddle.

 

[Aussie all the Way]

Don't worry ASIC is onto it, what will happen probably nothing, another toothless tiger setup for supposed protection much like the ACCC.

 

[mylittletibbies]

I was once asked to lie for a friend's sister,who had worked for me in the past. She no longer worked and she and her partner did not have enough income to get the house loan.
They were not happy when I refused. Tried to explain to them that I would not be doing them any favour by doing that.
They managed to get someone else to lie for them and two years later the house was repossessed as they couldn't keep up the payments and they not only lost their house.but all the deposit money snd stamp duty they had paid.
I tried to warn them but they just didn't listen.

 

[gordon1940]

I too had a “dodgy” home loan with figures that were “jiggled” so the application could be approved. Years later after my partner passed I tried to have my loan reassessed into my name only and was refused. I was told I couldn’t have a mortgage in my name only as I was on an age pension an to pay the loan out or the bank would sell my house. I had been with this bank over 25 years. The bank preferred to keep the loan as it was with my deceased partners name on it. I was fully aware this was unlawful and advised as such. “They were going to sell my house”. I immediately referred the matter to the Ombudsman and things changed quickly. Not only was the loan was changed to my name only but the interest rates were lowered. It pays to get advice….

I feel for you, BUT, were you not a Party to the "fiddle" if you were aware of it.

 

[Radiant]

Pathetic that these shonky franchises are allowed to operate. We once trusted the Bank but can’t trust anyone now!

 

[7777]

The only way to stop this criminal activity, that all these departments are doing is through honest people who are positioned above them. But where are these honest people.
Many people who have successfully reached high profile careers, whether in politics or government departments or even CEO levels, probably swear to do the right thing by the people, for the people.
However, as they say, the dollar is mightier than the sword. When one realises that they are seated at such a high level in their place of employment, with easy access to money at their finger tips, and with the beleif that no one can see the corruption taking place, well, it doesn't take much to work out why nothing is done about these current illegal activities, that are committed without any transparancy. The big CEOs cover each other as they are all in the same boat, the big managers cover for each other as they too commit similar illegal practices, and so on it continues to be the case at every level where there is interaction with the public and money.
And even if an honest member of the public wanted to take lead and truely create transparancy in these corrupt activities, they would not have a chance to do so. Primarily because they have to be elected or voted by the majority, to win their high profile position in banks and other departments. And who are the ones who elect the new manager, of course, the ones who are committing the coruption.
It takes a person with strong morals, and a clean conscience, to not to be tempted by the dollar.
Safety and fairness for the public can only be possible, if there is complete transparancy, and honesty, in the activities conducted by banks and other departments that people trust their money with.