The corporate regulator has alleged errors in ANZ Bank’s systems led to more than 165,000 credit card accounts being wrongly charged fees or interest, as it launched legal action against the bank for misleading conduct.
The Australian Securities and Investments Commission (ASIC) on Monday said it was taking Federal Court action against ANZ, alleging the bank overstated the funds that were available on credit card accounts. It said customers relied on this incorrect information when making withdrawals, and they were then wrongly charged fees and interest by the bank.
ASIC said ANZ Bank had overstated the available funds and balances on credit cards over a “long period.”Credit: Paul Jeffers
ASIC also claims the problem has not yet been fixed by the banking giant, despite ANZ paying more than $10 million in compensation over this issue to customers affected before 2018.
ANZ acknowledged the claim on Monday said it was considering the matters raised by ASIC.
The watchdog’s lawsuit says that between 2016 and September last year, the bank made false or misleading statements about customers’ “current balance” or “available funds” in situations where a customer had recently deposited money into credit card accounts.
ASIC said it appeared to customers as though their recently deposited funds were immediately available for withdrawal without incurring any fees or interest, even though the funds would not be cleared and credited to the account until the next business day.
As a result, ASIC said 165,750 ANZ customers were charged cash advance fees and interest for withdrawing or transferring money from their credit card between 2016 and 2018, based on an incorrect account balance.
ASIC deputy chair Sarah Court said on that average, affected customers were charged $47 in cash advance fees and interest, though there were cases of individuals being charged thousands of dollars in fees.
“We are concerned that, over a long period of time, ANZ overstated the available funds and balances on credit card accounts, and nonetheless charged fees and interest to customers who relied on this information when making withdrawals,” Court said.
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