Motel owners join class action against bank

A couple who say they were wronged by a major bank when they bought a Port Stephens motel have joined a class action against the lender.

Sylvia and Gilbert De Michiel paid $2.4 million for a Nelson Bay Motel in 2008, an amount agreed to by a Bankwest-appointed valuer.

But, the couple say the valuation was invalid, due to forged accounts and fake future bookings.

Sylvia De Michiel says the valuer also failed to mention that dogs had been living in the managers flat.

"The moment we had those keys handed over we walked up the stairs and the stench was unbelievable," she said.

Gilbert De Michiel says he was outraged at the state of the motel and has joined a class action against the lender.

"The minute we got into the property we realised that we'd been taken," he said.

"The property was not what we had actually bought.

"There were no bookings, there were no books, no nothing.

"The first week, I think we had one or two people, so in order to make this a goer we sold virtually everything we had."

After the Commonwealth Bank acquired Bankwest, a second valuation was ordered in 2011.

It was well below what the couple paid and the bank called in receivers, alleging they had breached their loan to value ratio.

The bank says it only appoints receivers when contractual obligations are breached.

Sydney lawyer Van Moulis is heading up the potential class action.

He says it is a complex case.

"It involves allegations relating to artificially low valuations of the security properties, primarily by Commonwealth Bank for the purpose of triggering early repayment and we say circumstances which were improper."

Bankwest says it does not sell properties for less than market value.

A Senate Inquiry is currently being held into the post-global financial crisis banking sector.

Mr Moulis says he is hopeful it will scrutinise the actions of Bankwest.

"As you might well imagine a number of the group have been financially devastated as a result of the bank's summing them up so I welcome the Senate Inquiry which will very likely investigate the circumstances surrounding the sale of Bankwest to the Commonwealth Bank."

Source: ABC News, 10 May 2012