Australia’s securities regulator says it will seek penalties and other orders against Commonwealth Bank of Australia after the Federal Court found the country’s top lender had overcharged interest to customers.
The Australian Securities and Investment Commission (ASIC) said the court declared CBA had misled customers on more than 12,000 occasions between December 2014 and March 2018, charging a higher interest on business overdraft accounts than what the customers were advised.
Australia’s largest bank also breached its obligation as a financial service licensee to comply with financial services laws, the court added.
The total overcharged interest exceeded $A2.2 million and was a result of “inadequate systems and processes”, the securities watchdog said in a statement.
ASIC will seek monetary penalties against CBA at a hearing on April 6.
The regulator had filed a civil lawsuit against the company in December regarding the overcharging of interest. The errors saw more than 2200 customers being charged a rate more than double what should have been levied, ASIC had then said.
CBA did not immediately respond to a Reuters request for comment.