CBA overcharged for almost 10 years: ASIC
The corporate regulator is taking Commonwealth Bank to court for allegedly charging customers $11.5m in fees that it was not entitled to.
The Australian Securities and Investments Commission alleges CBA overcharged customers for almost 10 years, despite assurances it would not charge access fees on accounts.
Federal Court filings allege CBA engaged in false and misleading conduct from at least 2010 to 2019, which resulted in the overcharging of $55m in fees to nearly one million customers.
However, the regulator is only able to take on the bank for the period of April 2015 to September 2019, due to restrictions on the period for which a court can impose a penalty.
ASIC alleges that over that period CBA reaped $11.5m by charging improper access fees on almost 2.4 million occasions.
The charges lobbed by the regulator allege CBA "contravened its obligation as an Australian financial services licensee to comply with financial services laws" due to the bank's repeated and ongoing failures.
The court filing from ASIC reveals at least 30 different ways CBA failed to ensure fee waivers were processed, due to inadequate systems and processes, as well as manual errors by bank staff.
The corporate regulator alleges the CBA lacked the technology and appropriate use of systems to ensure fee waivers.
Users of CBA's accounts were charged monthly fees of between $4 and $6.
The regulator alleges each time CBA notified customers via bank statements of charging fees it made false or misleading representations that it was contractually entitled to the money "when it was not".
CBA is alleged to have failed to undertake appropriate reviews of the multiple systemic issues that contributed to its fee waver failures.
That's despite CBA receiving almost 14,000 complaints from customers about fee overcharging over at least nine years.
ASIC notes CBA first identified problems with its systems that caused the overcharging as far back as January 2011, but only notified ASIC of the issue in December 2018.
The bank is reported to have only lodged a breach report with ASIC regarding the issue in May 2019.
CBA has repaid many, but not all, customers wrongly charged fees. Almost $66m has been repaid to one million CBA customers who were overcharged.
Originally published as CBA overcharged for almost 10 years: ASIC