UPDATE 2.55pm: Law firm Slater & Gordon is considering launching a class action on behalf of some former Bankwest customers over the Commonwealth Bank's takeover of the WA-focused bank.
Slater & Gordon lawyer Van Moulis said the law firm and litigation funder IMF Australia were assessing if a class action was viable after claims some Bankwest borrowers and mortgagers were disadvantaged after it was taken over by the CBA in 2008.
"We are looking at whether some of those people with Bankwest loans were hard done by when Bankwest re-valued their securities and called up their loans in the period after CBA took control of Bankwest,” Mr Moulis said in a statement.
"So far we have had about 120 people register with us, and their losses are quite significant.
"The types of cases we are looking at are primarily commercial developments and involve property developers and small to medium-sized business owners."
Mr Moulis told AAP that Slater & Gordon's investigation was still in its formative stages and evidence was still being gathered.
Mr Moulis said there had been an allegation - not yet backed by evidence - that the sales document related to CBA's acquisition of Bankwest had contained a “claw back” provision under which the purchase price was reduced by an amount related to the number of bad debts on the books of Bankwest.
Mr Moulis said some Bankwest clients alleged that they had had the value of securities backing loans from Bankwest reassessed in the wake of the CBA takeover and were consequently asked to repay their loans immediately, which in some cases had been financially disastrous.
"There is the allegation that the Commonwealth Bank radically, and in our view, improperly, revalued the properties (that acted as security for the loans),” Mr Moulis said.
Mr Moulis said the reassessment of the securities and the call in of loans had left some people out of pocket by $1.4 million to $1.8 million.
"It's effectively wiped out your small to medium-sized property developer who was with Bankwest,” Mr Moulis said.
"Devastation was wreaked. Most of these people were respectable, hard-working entrepreneurs."
Bankwest and the CBA were unavailable for comment today but the Commonwealth Bank recently said in a prepared statement that there was no basis to concerns Bankwest customers were treated unfairly after the takeover."In addition, speculation that suggests that CBA or Bankwest would take action to unjustifiably impair customer loans, impact its customers and reduce its profitability (and capital position) ignores commercial reality,” the CBA.
The new magazine for a new generation of West Australians.Click here to download »
All the latest market figures from Australia and the world.Click here »
'The West Australian' is a trademark of West Australian Newspapers Limited 2013.
All rights reserved.
Select your state to see news for your area.