illegal commissions, double-charging for insurance and failures in disclosing fees properly. The Sydney-based financial service provider admitted to the allegations and agreed to pay $113 million in penalties, in addition to $80 million that were to be paid to customers in remediation. Over the past month, federal court justice Jonathan Beach heard the cases against Westpac and handed down judgement on Friday (22 April), in the case of charging fees to dead people.
The judge said the banking giant had “utterly failed to address the issues systematically” and issued a fine of $40 million for the breaches. This is addition to the $20 million fine for allowing 21,000 company accounts that should have been closed to stay open, $15 million for double charging 7,000 customers for insurance, $16 million for selling debt to 16,000 customers and $6 million for failing to properly disclose financial service fees to 25,000 customers.
“The breaches found by the court in these six cases demonstrate a profound failure by Westpac over many years and across many areas of its business to implement appropriate systems and processes to ensure its customers were treated fairly,” Sarah Court, ASIC’s deputy chair, said, adding that the firm had failed in fulfilling some of its key obligations.
“Westpac, like all licensees, has an obligation to be honest and fair in its provision of financial services. Despite this, Westpac failed to prioritise and fund the systems upgrades necessary to help fulfil this obligation,” she said. “The sheer scale of this impact suggests that, at the time, Westpac had a culture that did not prioritise compliance.”
