Comonwealth Bank of Australia Admits Claims
In this article (4)
Comonwealth Bank of Australia – one of the country’s «big four» lenders – will not contest two lawsuits from local regulatory alleging misconduct against clients.
The Australian Securities and Investments Commission (ASIC) is seeking A$5 million ($3 million) in penalties from CBA for failing to provide certain benefits to buyers of the financial product AgriAdvantage Plus. According to ASIC, 8,659 customers were affected by misconduct on 131,542 occasions which resulted in gains by CBA totaling $5 million from incorrectly charged fees, loam interests and unpaid savings interests. The bank has since reportedly refunded approximately $4.9 million including interest.
CBA intends to admit the allegations made in ASIC’s Concise Statements for both matters and does not intend to defend the proceedings, according to a report citing a bank.
The second uncontested case involves a habitual gambler, David Harris, who was able to obtain multiple credit limit increases which reached $21,400 despite the bank’s knowledge of his self-admitted problem. I would max it out, pay off chunks, I would try and work overtime to help pay off chunks and I would wait until I had a big win or saved up a lump of money to pay it off and do it again, he said, according to a report.
The bank did not do the right thing by this customer and we apologize,» said CBA chief executive Matt Comyn. In recent years we have implemented a number of changes to support our customers’ needs.
Questions & Answers
Q.What specifically did the Commonwealth Bank of Australia do wrong in the AgriAdvantage Plus case?
What specifically did the Commonwealth Bank of Australia do wrong in the AgriAdvantage Plus case?
ASIC alleges the bank failed to provide certain benefits to buyers of the financial product AgriAdvantage Plus. This misconduct affected 8,659 customers on 131,542 occasions, leading to the bank gaining $5 million from incorrectly charged fees, loan interests and unpaid savings interests.
Q.How much compensation has the bank paid out in relation to the AgriAdvantage Plus issue?
How much compensation has the bank paid out in relation to the AgriAdvantage Plus issue?
The bank has reportedly refunded approximately $4.9 million, which includes interest. This amount is close to the $5 million the bank gained from the alleged misconduct involving incorrectly charged fees, loan interests, and unpaid savings interests.
Q.What misconduct did the bank admit in the second case?
What misconduct did the bank admit in the second case?
The second case involved David Harris, a habitual gambler, who was able to obtain multiple credit limit increases up to $21,400. This occurred despite the bank knowing about his self-admitted gambling problem, which its chief executive acknowledged was not the right thing to do.
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