Australia’s corporate regulator has slapped Westpac with six civil penalty proceedings at once, for which it’s facing a $113 million fine.
In an unprecedented step, the Australian Securities and Investments Commission, ASIC, filed the legal actions after multiple investigations in 2021 into allegedly massive compliance failures.
ASIC said the alleged misconduct, to which Westpac has admitted, happened over years across multiple arms of the big bank and impacted thousands of its customers.
In one lawsuit it alleges that Westpac charged $10 million in financial advice fees to deceased clients. It also alleges Westpac charged more than 7,000 customers multiple, identical insurance policies for the same property, meaning they paid twice when they shouldn’t have.
Other allegations include charging super commissions, which are banned; not disclosing fees adequately; allowing accounts to sit open for entities that were defunct; and debts being passed on with incorrect interest rates.
ASIC deputy chair Sarah Court said on Tuesday that these alleged breaches of conduct had caused widespread consumer harm, and that ASIC was disappointed to have to pursue so many cases at once.
“It is unprecedented for ASIC to file multiple proceedings against the same respondent at the same time,” Court said.
“However, these were exceptional circumstances … and we decided to expedite those matters for consideration by the court at the earliest opportunity.”
Westpac has admitted the allegations in each of the proceedings and will pay $80 million back to its customers.
ASIC said that Westpac was looking to settle the actions for an “appropriate” penalty and had reached an agreement. Westpac and ASIC will jointly submit agreed proposed penalties for each of the proceedings, totalling $113 million, subject to court approval.
Westpac’s CEO Peter King admitted in statement that these breaches should not have occurred.
“In each of these matters, Westpac has fallen short of our standards and the standards our customers expect of us. The issues raised in these matters should not have occurred, and our processes, systems and monitoring should have been better. We are putting things right and unreservedly apologise to our customers.”