Westpac the second major bank to test credit invite law
Westpac has become the second major after the Commonwealth Bank to attract the attention of the Australian Securities and Investments Commission (ASIC) over a communication to customers inviting them to increase their credit limit.
Changes to the National Consumer Credit Protection Act effective from 1 July 2012 mean card issuers may not send credit limit increase invitations to customers unless the customer has consented.
Westpac has agreed to withdraw and modify messages sent to its customers about credit card limit increases after ASIC raised concerns they were misleading.
Around 3700 customers consented to receive future invitations as a result of the messages, which ASIC said were misleading as they implied the customers could miss out on accessing additional funds and created the impression customers needed to act urgently.
"Westpac has acknowledged ASIC's concerns and has undertaken to not rely on the consents obtained from customers who may have been misled, and contact each customer who consented to correct any misleading impression," ASIC commissioner Peter Kell said.
In March the Commonwealth Bank entered into an enforceable undertaking with ASIC over a similar matter, which resulted in 96,000 customers consenting to receive credit limit increase invitations.
Recommended for you
Licensing regulation should prioritise consumer outcomes over institutional convenience, according to Assured Support, and the compliance firm has suggested an alternative framework to the “licensed and self-licensed” model.
The chair of the Platinum Capital listed investment company admits the vehicle “is at a crossroads” in its 31-year history, with both L1 Capital and Wilson Asset Management bidding to take over its investment management.
AMP has settled on two court proceedings: one class action which affected superannuation members and a second regarding insurer policies.
With a large group of advisers expecting to exit before the 2026 education deadline, an industry expert shares how these practices can best prepare themselves for sale to compete in a “buyer’s market”.
