ASIC claims Westpac scalp in misleading ad campaign
Westpac Banking Corporation has become the first organisation to fall foul of the Australian Securities and Investments Commission (ASIC) in its campaign against misleading advertising, after the corporate regulator raised concerns with the bank that the advertising for its Westpac Choice account was likely to mislead customers.
Westpac advertised its Choice account as being free of monthly service fees for customers who deposited at least $2,000 per month along with a 'commitment' from Westpac to lowering the cost of banking.
ASIC was concerned that the ad suggested that the removal of the monthly service fee was a permanent feature of the account, which also applied to existing customers, when it only applied to new customers for the duration of the promotional period, except for new customers who applied for the feature during the promotional period.
In response to ASIC's concerns, Westpac has decided to make the no-service-fee an ongoing feature of the account and institute the change that customers will no longer be able to avoid monthly service fees by maintaining a monthly balance of $3,000. The features will come into effect on June 1.
The bank is also contacting customers to make sure they have not been misled over the advertisements and inform them of the new change. It will also inform customers who opened a Choice account before November 15 that they will need to contact the bank to avoid the monthly fee.
ASIC said in a statement that while it understands that financial service providers offer promotions to new customers, it is important that the advertising clearly states whether an offer is available to existing customers, how it applies and when an advertising feature runs for a limited period.
Recommended for you
ASIC has permanently banned a former Perth adviser after he made “materially misleading” statements to induce investors.
The Financial Services and Credit Panel has made a written order to a relevant provider after it gave advice regarding non-concessional contributions.
With wealth management M&A appetite only growing stronger, Business Health has outlined the major considerations for buyers and sellers to prevent unintended misalignment between the parties.
Industry body SIAA has said the falling number of financial advisers in Australia is a key issue impacting the attractiveness and investor participation of both public and private markets.
