A Federal court has slapped a A$250 million fine on lender ANZ Group for mismanaging a A$14 billion government bond deal alongside other shortcomings that hurt both taxpayers and retail customers, according to Australia’s corporate regulator on Friday.
The Australian Securities and Investments Commission said the penalty was imposed across four separate cases involving misconduct in ANZ’s institutional and retail banking units. The combined penalty is the largest that ASIC has ever announced against a single entity, reflecting the seriousness and scale of the breaches.
Multiple Penalties Hit ANZ for Different Failures
ANZ has been fined A$135 million for institutional and market breaches tied to the government bond deal and for inaccurate secondary bond market turnover reporting. This includes a record A$80 million for unconscionable conduct.
The bank must also be fined A$40 million for failure to respond to hundreds of customer hardship notices. It is to pay another A$40 million for misleading savings-rate statements and underpaying interest to tens of thousands of customers. ANZ must pay A$35 million for not refunding fees charged to thousands of deceased customers.
Justice Jonathan Beach increased the penalty by A$10 million to A$50 million for inaccurate reporting of secondary bond market turnover data, the watchdog said. The court found ANZ’s conduct “inexcusable”.
Watchdog Has Brought 11 Cases Against ANZ Since 2016
Since 2016, ASIC has brought 11 civil penalty proceedings against the country’s number four bank. A review into the bank found it had a culture that made staff reluctant to speak up and red tape that hampered some of its processes. In September, ASIC and ANZ asked the court to impose penalties of A$240 million in relation to the four matters. The court added A$10 million to that figure.
ANZ’s shares were up marginally at A$36.08 at 0454 GMT, against a 0.4 per cent gain in the ASX200 benchmark index. The modest share price rise implies investors were already priced for the penalties.
The penalties come as Australian banks are facing increasing scrutiny over their treatment of customers and the way they manage obligations. The government bond deal at the centre of some fines was a A$14 billion deal, one of the biggest transactions in recent Australian history.
The penalties warn other banks that regulators in Australia are taking a “zero-tolerance” approach to misconduct. The size of the fines reflects a deepening frustration with financial institutions failing to meet obligations to customers and the public.
Stay ahead with the recent news and latest news updates. Follow Inspirepreneur Magazine for more updates.
