Powered by momentummedia
nestegg logo
Powered by momentummedia
nestegg logo
nestegg logo

Borrow

CBA taken to court over banking fees

By Reporter
  • April 01 2021
  • Share

Borrow

CBA taken to court over banking fees

By Reporter
April 01 2021

ASIC has commenced civil penalty proceedings against the Commonwealth Bank of Australia, alleging that it charged clients millions in monthly fees when it was not entitled to do so.

CBA taken to court over banking fees

CBA taken to court over banking fees

author image
By Reporter
  • April 01 2021
  • Share

ASIC has commenced civil penalty proceedings against the Commonwealth Bank of Australia, alleging that it charged clients millions in monthly fees when it was not entitled to do so.

CBA taken to court over banking fees

ASIC alleged that between 1 June 2010 and 11 September 2019, CBA incorrectly charged monthly access fees of almost $55 million to nearly 1 million customers – and more than 800,000 accounts – who were otherwise entitled to fee waivers.

For the period in which the court can impose a penalty (1 April 2015 to 11 September 2019), ASIC alleged that CBA charged $11.5 million in incorrect fees.

“By engaging in the above conduct, ASIC alleges that CBA also engaged in misleading or deceptive conduct and contravened its obligation as an Australian financial services licensee to comply with financial services laws,” ASIC said.

Advertisement
Advertisement

ASIC also found that CBA made false or misleading representations to customers that it was contractually entitled to charge the fees when it was not, and that it would have adequate systems and processes in place to provider waivers – which ASIC alleged it did not. 

“ASIC commenced this proceeding because financial institutions need to have robust compliance systems to meet their obligations to customers. Financial institutions need to put customers first, and customers should have confidence that the banks they deal with charge fees correctly,” ASIC said.

The proceeding will be listed for a case management hearing on a date yet to be set.

In a statement to the ASX, the big four bank acknowledged the proceedings, highlighting that they relate to an error.

“CBA apologises to all customers impacted by these issues. Remediation payments of $64.2 million (including interest) have been sent to customers,” CBA said.

“Of the total remediation payments, approximately 90 per cent related to two fee waiver issues that were identified in 2017 and 2019.

“The remediation of customers affected by the issue in these proceedings has been completed,” it concluded. 

CBA taken to court over banking fees
CBA taken to court over banking fees
nestegg logo

Forward this article to a friend. Follow us on Linkedin. Join us on Facebook. Find us on Twitter for the latest updates
Rate the article

more on this topic

more on this topic

From the web

Recommended by Spike Native Network

More articles

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.