ANZ bank has acknowledged that it made false representations to customers in two distinct cases, leading to overcharges exceeding $4 million.
The Financial Markets Authority reports that ANZ has acknowledged violating fair dealing laws and has agreed to pay a $3.25 million fee to the government in place of a pecuniary penalty under the Financial Markets Conduct Act.
The first violation involved incorrectly charging fees and interest on customers’ accounts for unarranged overdrafts from December 20, 2012, to May 31, 2023, impacting 209,960 ANZ customers.
The total amount of wrongly charged overdraft fees was $4,373,972, which included $879,078 in excess interest.
Reports said ANZ compensated all affected customers and made reasonable efforts to reach out to all former customers impacted.
The second fair dealing breach involved improperly recovering mortgage incentive payments that were given to customers on the condition that they maintain their banking with ANZ for two to three years.
According to FMA head of enforcement Margot Gatland, ANZ requested repayment from customers who paid off their mortgage early, based on the assumption that they were transferring some of their banking to a competitor, which would violate the terms of the incentive payments.
“However, in some instances ANZ has since not been able to verify that the customer breached the agreement to keep its banking with ANZ and has therefore remediated 1019 customers who fall within this category,” she said.
“Banks are required to ensure representations they make to customers about overdraft fees and cash contributions are not misleading and do not cause harm to customers.
“ANZ made false representations in both instances.”
Gatland said ANZ self-reported the two fair dealing breaches and that it accepted the FMA’s findings.
“We remain committed to doing the right thing by our customers and continuously improving how we operate,” ANZ said.