(Reuters) – Australian securities regulator said on Tuesday it has filed six civil penalty proceedings against Westpac Banking Corp, the country’s third-largest bank, alleging widespread compliance failures across its business over many years.
The Australian Securities and Investments Commission (ASIC), in a statement, alleged multiple Westpac brands were involved in fees-for-no-service, distribution of duplicate insurance policies and sale of credit card and flexi-loan debt with incorrect interest rates, among others.
“The conduct and breaches alleged in these proceedings caused widespread consumer harm and ranged across Westpac’s everyday banking, financial advice, superannuation and insurance businesses,” ASIC Deputy Chair Sarah Court said.
“Westpac must urgently improve its systems and culture to ensure these systemic failures do not continue.”
The allegations were made against Westpac’s banking, superannuation, wealth management and its now divested general insurance businesses.
Westpac has admitted the allegations in each of the proceedings and will remediate about A$80 million ($57.06 million) to customers, ASIC said.
“The issues raised in these matters should not have occurred, and our processes, systems and monitoring should have been better,” Westpac CEO Peter King said in a separate statement.
Westpac and ASIC will jointly submit proposed penalties for each of the proceedings totaling A$113 million, the bank added.
Last week, the Reserve Bank of New Zealand said Westpac’s local unit needs to address risk governance and compliance concerns after an independent report highlighted “material shortcoming” in the board’s oversight.
(Reporting by Sameer Manekar in Bengaluru; Editing by Krishna Chandra Eluri)
