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Big four bank hit with multi-million dollar penalty

Lachlan Maddock
— 1 minute read

A big four bank has been ordered to pay a $5 million dollar penalty by the Federal Court after it was found to have breached the ASIC Act and the Corporations Act.

ASIC alleged, and the Commonwealth Bank admitted, that CBA’s AgriAdvantage Plus Package (AA+) did not provide certain benefits to customers contrary to its terms, and as a result, customers were overcharged fees and interest on loans and fees. CBA also overcharged AA+ package fees to certain customers. 

A total of 8659 customers were impacted by CBA’s conduct on 131, 542 occasions, with CBA benefiting to the tune of $8,087, 276.3 in incorrectly charged fees and interest on loans, and underpaid interest on savings.

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“ASIC considers that CBA’s conduct in this matter, which was examined in detail during the Financial Services Royal Commission, was the result of inadequate systems and processes,” said ASIC Deputy Chair Daniel Crennan QC. 

“As recognised by Justice Beach in his judgment, CBA took steps to address the harm that the conduct caused and, importantly, made admissions as to its contraventions of the law at the first possible opportunity in the litigation.”

 

Big four bank hit with multi-million dollar penalty
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