Opinion: #MeToo hits the mortgage industry

On 5 July, California-based national mortgage banking firm Summit Funding Inc. lost a $1.6 million binding arbitration for age discrimination and constructive discharge. 

A former senior vice president of the National Builder Division was awarded compensatory and punitive damages, plus attorneys’ fees and costs, by the Hon. John Flaherty (Ret.) based on consistent outrageous discriminatory comments made by Summit profit participant and CORE coach Rick Ruby. 

Seven former employees were called to substantiate the claims and each testimony was found persuasive.  

Ruby’s comments were heard by employees and management — live, on video and on conference calls.  According to the award, Ruby said things like he had “no use” for older workers, “dinosaurs” and “Humpty Dumptys.”  

Ruby encouraged Summit to hire “young and sexy” and said that older workers should get out of the mortgage business and lacked “fire in their bellies.”

Summit’s defense was rejected as “pretextual” and the judge specifically ruled that Ruby’s discriminatory conduct was “enabled and condoned” by Summit president Todd Scrima. 

In addition to having to endure discriminatory comments, Judge Flaherty agreed that the former senior VP proved that she was forced out of the company based on her age.  The employee received effusive praise, raises and bonuses throughout her employment.

“Discrimination of any type in the workplace should never be tolerated,” said attorney Nancy Gray of Gray & Associates PC, who represented the employee. 

“The wholesale disregard of the law, professional ethics and decency demanded swift action and we hope the judgment against Summit will deter them and others from committing similar conduct.”

Judge Flaherty determined that Summit acted with malice, fraud and oppression, resulting in an award of punitive damages against Summit. 

What has this got to do with us?

Age is regularly brought up in mortgage broking. I recall an on-record interview with the head of a major aggregator years ago, in which he happily explained the need to bring “young blood” and “more women” into mortgage broking. He said the average age of a mortgage broker in Australia was around 54. Back in 2015, there was nothing potentially dangerous in his words. Today, they could clearly be taken the wrong way. 

I’ve heard people discuss “dinosaurs” before; some even refer to themselves in this way. I’ve also become aware of the push to bring more women and “young guns” into the industry.

While these pursuits are effectively noble, they can easily be taken the wrong way, particularly as the #MeToo movement rolls through the corporate sector. It has also hit federal politics. 

Earlier this year, Minister for Financial Services Kelly O’Dwyer MP announced “a federal fighting fund” to encourage more women to be elected in the Liberal Party and asked if men could help shoulder more responsibility for caring for families at home. 

“There's a pretty strong culture in this country that says that women are the ones that need the flexibility, not men, and I simply challenge that. 

“I know in certain workplaces, it’s only women who take on board the opportunity to work flexibly and when men actually asked for that opportunity, there are a lot of raised eyebrows,” she said.

As the mortgage broking industry continues to encourage greater diversity, there is a danger of crossing the line into unintended sexism and ageism.

But where do we draw that line?