CBA required to publish misconduct notices
The Federal Court has ordered the Commonwealth Bank of Australia (CBA) to publish notices on its website and its newsroom acknowledging the bank’s false or misleading conduct when it overcharged interest on business overdraft accounts.
The Australian Securities and Investments Commissions commenced proceedings against the CBA and the court found it breached the law on 12,119 occasions when it charged higher-than-advised interest rates on business overdraft accounts and was required to pay a $7 million penalty.
CBA was required to ensure that each notice appeared immediately upon access to the landing page as a picture tile on the websites under the heading “Notification of Misconduct by CBA” and is maintained on the websites for 90 days.
CBA must comply with these adverse publicity orders within 30 days and had been ordered to provide a proposed version of the audio-visual notice to the court by 27 August, 2021.
Sean Hughes, ASIC commissioner, said: “The requirement for CBA to notify its customers and the general public that it unlawfully overcharged interest is an important part of deterrence, along with the $7 million fine handed down by the court.
“Not only does it ensure that CBA's customers and the general public are aware of the misconduct, it sends a strong message that there is significant financial and reputational risk for failing to have the systems in place to prevent overcharging.”
Recommended for you
Government has introduced a bill to Parliament to legislate the first stream of the QAR reforms.
ASIC now has a 1:1 ratio when it comes to court success in the enforcement of crypto activities and more action is expected as Treasury seeks to introduce a regulatory framework.
A leading governance body has hit out at “specialist interest groups proposing ad hoc law reform” when it comes to reforms of financial services legislation and believes an independent body is needed.
The release of ALRC’s final report into financial services legislation has highlighted financial advice as a “significant” focus as it seeks to reduce costs and help advisers understand their obligations, alongside the Quality of Advice Review.
