Royal commissions have a way of getting to the nub of the issue and revealing a stinking mess of corruption and crime. But they, much like most issue in politics, are also hostage to perceptions. Where they become most damaging is when their findings confirm suspicions. This is done to the full extent with the release on Friday of the interim report of the royal commission into the financial services sector. The nub of the issue for this government is that it can take no pride in these findings because the then treasurer and now prime minister, Scott Morrison, fought repeatedly against holding the commission at all.

One of my favourite lines in a royal commission report was that in the commission on the home insulation program. It was a commission set up by the Abbott government for no other purpose than to attempt to embarrass the former Rudd-Gillard government.

It came off the back of some fairly disgraceful reporting conducted across newspapers and radio talkback programs, which had suggested that the insulation was shoddily installed and was leading to houses burning down. Talkback hosts scared people with absurd fears about the dangers of house fires, newspapers breathlessly reported the numbers of house fires without any context or reference to the vast numbers of houses that had received insulation.

The fires were also manna from heaven for the Liberal party. Who needed reality when there was exaggeration to feed on? Tony Abbott told parliament in 2010 of “pink batts – a program which has caused house fire after house fire”.

And so when the royal commission into the home insulation program gave its findings, you would have expected its conclusion on house fires to be pretty damning.

Instead, the commissioner found that the number of fire incidents equated to “0.02% of installations” and that the fire incident rate for homes was actually lower under the program than that which had occurred prior to the program’s commencement.

And, in one of the most damning statements ever made about the media, and which should have seen all journalists and editors associated with such reporting shamed out of the industry, the commissioner noted, “the occurrence of fires does not appear to have been an issue of particular concern, other than to the media”.

However, reality remained no issue of particular concern for politicians. Just six months after the commission handed down its report, Abbott boasted to parliament that unlike the ALP his government “did not put pink batts in people’s roofs only to see them catch fire and houses burn down”.

Nothing will alter the words of Morrison both prior to and after the royal commission was announced

And the current prime minister, Scott Morrison, is also more than happy to spout the fiction rather than the reality. He told parliament last year that the previous ALP government wasted money “on setting fire to people’s roofs with their pink batts program”.

And, if we’re honest, given the amount of fear-mongering both by politicians and the media, and the lack of coverage of the findings, the perception that houses caught fire in massive numbers probably is believed by most.

It’s the problem with royal commissions – they can get to the nub of the issue but even their findings struggle to correct false perceptions.

They are most powerful when their findings confirm the perceptions.

The two perceptions about the royal commission are that banks and insurance companies are screwing customers, and that the government, led by Morrison as treasurer, did everything it could to avoid holding the royal commission.

The commission’s interim report certainly confirmed the first perception, and nothing will alter the words of Morrison both prior to and after the royal commission was announced.

The calls for this commission, which according to Morrison were just “crass populism”, have found “the answer” for the systemic misconduct in the financial industry “seems to be greed – the pursuit of short-term profit at the expense of basic standards of honesty” and that this “culture and conduct of the banks was driven by, and was reflected in, their remuneration practices and policies”.

This commission, calls for which were – according to Morrison – “nothing more than a populist whinge”, has found that “when misconduct was revealed, it either went unpunished or the consequences did not meet the seriousness of what had been done”, that the conduct regulator, Asic, rarely went to court to seek public denunciation of and punishment for misconduct, and that there were many “occasions when profit has been allowed to trump compliance with the law, and many more occasions where profit trumped doing the right thing by customers.”

This commission, which according to Morrison was a ploy by the ALP “just intended to bolster and prop up the stocks of a leader of the opposition”, has seen banks admit they have “engaged in misconduct and conduct falling short of community standards and expectations in connection with home loans, credit cards, processing errors and car finance” including Westpac admitting processing failures that “resulted in approximately 69,000 home loan customers being required to pay more interest over the life of their loan” and which would cost Westpac $11m to repay”, or NAB admitting to “erroneous recording of 16,288 credit defaults against customers with NAB credit cards or personal loan accounts”, some of which “involved contraventions of the Privacy Act”.

This commission, which according to the then treasurer was just the ALP wanting to “undermine and play reckless havoc with the banking and financial system”, has found that ANZ “between 2006 and 2013, charged “more than 10,000 Prime Access customers ... for documented annual reviews that were never provided” and that it “continued to deduct ongoing service fees from the accounts of certain customers who had cancelled their services”, and which saw the Commonwealth Bank admit it charged for “annual reviews to approximately 31,500” customers between 2007 and 2015 that were not undertaken.

Even on announcing this royal commission, the then treasurer and now prime minister said the “reason” the commission was being held was “the recklessness of the leader of the opposition and the shadow treasurer for over two years calling into question the integrity and the system security of our banking system and financial system”.

That commission has revealed that “clients seldom complained about being charged for nothing” because “the fees they paid were charged invisibly” and that “the banks have gone to the edge of what is permitted, and too often beyond that limit, in pursuit of profit, and they have gone beyond the limit: because they can; and because they profit from the misconduct”.

So much for integrity.

The commission’s interim report is utterly damning of the banks and the regulators, which are shown to be mostly without teeth and unwilling to use what teeth they had.

It noted that “risk to reputation was ignored. Discovery of misconduct was ‘managed’ by words of apology and promises to do better. But little more was done than utter the apology and make the promise. More often than not, remediation programs were eventually set up but usually after protracted negotiation. Profit remained the informing value.”

And the commission’s report is utterly damning of Morrison’s judgment.

• Greg Jericho is a Guardian Australia columnist

• This article was amended on 1 October 2018 to clarify that Scott Morrison’s “populist whinge” comment was made in relation to the demands for a royal commission, not the inquiry itself.