Westpac bank fined $3.25 million over its historic breaches
Westpac is New Zealand's fourth-biggest bank by total assets.
Photo:
AFP
One of the country's biggest banks has been ordered to pay a multi-million-dollar penalty for misleading and overcharging customers.
The High Court has fined Westpac New Zealand $3.25 million for misleading customers entitled to advertised discounts, and for overcharging some business customers.
The historic breaches resulted in $6.35 million in overcharges and
affected nearly 25,000 customers
.
Westpac admitted the breaches in a civil case brought against it by the Financial Markets Authority at the High Court in Auckland, in December last year.
The FMA said customers entitled to various benefits under its Employee, Gold and Platinum (EGP) packages failed to receive the advertised discounts.
The EGP packages were offered between February 2004 and November 2021.
The FMA also said personal and business banking customers did not receive benefits under one of Westpac's other advertised packages, called Association Packages.
And finally, the FMA said Westpac failed to honour agreed pricing for business customers who held Business Transact Accounts.
As of 31 December 2024, Reserve Bank data showed Westpac was New Zealand's fourth-largest bank by total assets.
It made a
profit of $1.05 billion
for the year ended September.
"Westpac's issues stemmed from deficiencies in its systems that meant the bank failed to deliver contractually agreed discounts to customers," FMA head of enforcement Margot Gatland said.
Justice Geoffrey Venning issued a 35 percent discount to the penalty, noting Westpac self-identified the issues and reported itself to the FMA, and fully cooperated with the investigation.
"Westpac acknowledged responsibility for its failures from the outset and has been entirely open and cooperative with the FMA throughout the investigation, admitting liability at the earliest stage," Justice Venning said.
A Westpac spokesperson said all customers had been remediated and it no longer offered the packages.
"Westpac co-operated fully with the FMA's investigation and we are pleased to have resolved the matter," the bank said.
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