Westpac refunds $9.2m to affected clients
Westpac has refunded around $9.2 million to 161,414 eligible customers after it failed to waive fees on Westpac and St. George branded savings and transaction accounts.
Following the Corporations Act, Westpac reported it to the Australian Securities and Investments Commission (ASIC) which said it had acknowledged the "cooperative approach taken by Westpac in resolving this matter".
Between 2007 and 2013, Westpac Choice and Westpac Reward Saver accounts were opened for some eligible clients, aged under 21 years, without the relevant fee waivers being applied. At that time, Westpac relied on its staff to manually apply the following fee waiver benefits.
Westpac also reported that there were over 28,000 customers, who were under the age of 18, and who were eligible for a freedom student transaction account, operated by St. George with no monthly service fee, but instead held a standard St. George transaction account which charged a monthly fee.
ASIC deputy chairman, Peter Kell, said: "Financial institutions that offer products with benefits such as fee waivers must have effective and robust systems in place to deliver the promised benefits to consumers.
"Businesses that rely on manual processes to apply waivers, discounts and other benefits should carefully consider how they manage the risks of processes not being followed, including having appropriate controls and procedures in place."
Westpac said it had now provided refunds to the affected customers with payments including an additional amount reflecting interest.
Additionally, the bank assured it would monitor the activity to ensure the correct treatment of eligible accounts and introduced an automated application of the relevant fee waivers based on the customer's date of birth submitted during the application process.
AUTHOR
Oksana Patron
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
