Australia and New Zealand Banking Group (ANZ) has been ordered to repay A$211m to customers and has been fined A$25m.
According to Reuters, ANZ was fined after failing to provide agreed benefits to some of its offset accounts.
The Australian Securities and Investments Commission (ASIC) said the federal court found that ANZ didn’t provide fee waivers and rate discounts to at least 689,000 customer accounts for around 20 years.
The accounts were offered under ANZ’s ‘Breakfree’ package that was introduced in 2003, which provided fee waivers, credit cards and transaction accounts, interest rate discounts on home loans and other benefits in exchange for an annual fee.
ASIC said that ANZ’s offset transaction customers were entitled to interest rate reductions on eligible home and commercial loans, which were not always passed on.
ANZ said the remediation program for the offset account issues has now been completed, and a majority of payments have been made to customers affected by the Breakfree package issues – with the remaining payments expected to be made early next year.
ANZ said, “ANZ accepts that its conduct fell short of expectations and apologises to its customers who have been impacted.”
ASIC deputy chair Sarah Court said, “Having the necessary systems and processes to ensure customers are given the benefits they are promised is not an optional extra, it is a requirement. ANZ, for many years, failed to prioritise and deploy the systems and processes necessary to fulfil its obligations.”
The Financial Conduct Authority (FCA) recently fined Gatehouse Bank over £1.5m for substantial weaknesses in its financial crime system and controls.
Between June 2014 and July 2017, Gatehouse failed to conduct sufficient checks on tis customers based in countries with a higher risk of money laundering and terrorist financing.
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