The Australian Competition and Consumer Commission has laid infringement notices against four banks which it says were charged customers for services that they never received.
After more than two years the watchdog has now successfully brought its case against Westpac and is set to win a payout worth more than $81m.
The ACCC alleges the bank overcharged customers by $28m between 2009 and 2015.
The commissioner, Rod Sims, said: “While this case is an exception, Australian banks and wealth managers should take note that their consumers must be clearly and adequately alerted to the costs and benefits of products, and the fact that customers must fully understand and consent to their financial arrangements.”
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With more than 500 pending cases the ACCC is tightening its focus on “corporate champions” and its lawyers are working to determine who will be the next person to be charged.
According to the ACCC it appears the bank charged funeral directors for estate planning services.
The document states: “The financial adviser breached its duty by failing to make clear to a deceased customer that it was charging them over and above the advice fee for services to which the client had previously consented; and that it was likely that the party it was paying for these services had not received them”.
In a statement the bank responded to the allegation it should pay back the overpaid fees, saying: “Westpac takes this matter very seriously and we are extremely disappointed with the outcome. We are reviewing the notice together with the Competition and Consumer Commission.
“We are committed to building trust with our customers and we apologise unreservedly to those customers involved in this claim. Our staff acted in good faith and we will ensure that corrective action has been taken.
“We have disciplined our staff involved and put in place a range of systems and controls to ensure that all of our staff understand the obligations that they have to our customers.”