Last week, I met with a group of Australians who’d been ripped off by our banks and heard their harrowing stories. One man’s story in particular sticks in my mind.

A few years ago, “John” went to his bank seeking a loan to buy a new investment property. His application form was doctored to dishonestly increase his income and assets. The rent on the property was factored in — even though it was years from being built.

His loan should never have been approved. Yet when he requested the application forms, he was told the original was not available, only a scanned copy. Today, financial stress has ground down this hard-working Australian who struggles to pay just his interest payments. Every day is now a struggle for him because of the actions of his bank.

The fact something like this can happen to a person is appalling. The fact this is far from a one-off, and John’s story is far from the worst of it, is a national scandal.

Tens of thousands of Australians have been ripped off by our financial institutions

— enough is enough.

That’s why a new Labor government will hold a royal commission to clean up the banking sector. Every Australian uses a bank. We all rely on the integrity of our banking system. Australian families trust banks with their home loans, small businesses count on them for capital, and older Australians depend on banks for securing their retirement savings.

Trust and confidence in our banking system is vital to the health and strength of our economy. Which makes the crooked behaviour by Australian banks, financial planners and insurers — from ripping-off retirees to re-writing business loans — all the more galling.

Australians and their loved ones have had insurance claims denied, others have lost their entire investment because of high-risk practices they never agreed to. Signatures have been forged, documents tampered with. Sham contracts have been concocted and witnesses have been faked.

We’re not talking about isolated incidents here. This is a systemic, cultural problem that must be tackled.

Since 2009 at least 111 bankers, planners and advisers have been quietly sacked or reported to ASIC for misconduct — more than one a month. Little is known about what led to these sackings or what any internal investigations may have unearthed.

It’s hard to put a figure on the cost of banking scandals, but when Storm Financial folded, Australians lost nearly $3 billion in that collapse alone.

Labor resisted calls for a royal commission for more than a year. The banks promised they’d improve — the industry has had an abundance of chances to fix these problems but things have only got worse. Scandal after scandal is piling up. Our financial institutions have shown they are either unwilling or unable to clean up their own act.

When hard-working Australians are being ripped off time and time again, something needs to change.

Funding cuts mean ASIC and other regulators lack the resources to apply the proper scrutiny. A royal commission looks at whether the laws are adequate, ASIC only looks at whether laws are being followed.

This doesn’t need to be a point of political conflict. Several members of the government have backed our call. From rural MPs who’ve seen farmers get a raw deal to suburban representatives who’ve heard the voices of small businesses and families.

But when I see reports of Turnbull and Morrison holding secret talks with the banks to work out how to avoid a royal commission into misconduct, I think of people like John and it makes my blood boil.

Who is Turnbull more determined to protect — banks or consumers? Why is he seeking permission from the banks about what sort of action they’ll tolerate?

Why are we hearing he thinks it’s OK for ASIC to be investigating itself?

Gentle pruning won’t do the job, we need to pull these cultural problems out by the root. It’s time for Turnbull and Morrison to stop protecting the banks.

Anything less than a royal commission is a cover-up from Turnbull. Half-baked measures from the government designed to silence these scandals as an election issue simply will not cut it.

It’s time for a pro-active, empowered royal commission to set new standards for our banks and financial planners and to restore Australians’ faith and confidence in the sector.

This opinion piece was first published in The Daily Telegraph on Wednesday, 20 April 2016