By Alice Uribe


SYDNEY--Australia & New Zealand Banking Group Ltd. has been ordered to pay a fine of 25 million Australian dollars (US$16 million) after the Federal Court of Australia found that it had misled customers and failed to provide account benefits it had promised.

In a judgment handed down on Wednesday, the court found that the Australian lender failed to provide benefits such as fee waivers and interest-rate discounts to around 689,000 customer accounts for more than 20 years, up until September 2021.

The matter was the final civil case filed following the Australian Securities & Investments Commission's enforcement investigations based on the findings of the Financial Services Royal Commission into misconduct in banking and financial services.

"Having the necessary systems and processes to ensure customers are given the benefits they are promised is not an optional extra, it is a requirement," ASIC Deputy Chair Sarah Court said.

"ANZ is a large financial institution that for many years failed to prioritize and deploy the systems and processes necessary to fulfill its obligations."

ANZ said in a statement Wednesday that it had acknowledged contraventions in a statement of agreed facts and admissions filed with the court relating to system errors and benefits not being applied.

"While the court accepted that ANZ's conduct was not deliberate, and acknowledged ANZ's cooperation during the ASIC investigation, ANZ accepts that its conduct fell short of expectations and apologizes to its customers who have been impacted," the bank said.

"As part of the resolution ANZ has agreed to a A$25 million civil penalty and to pay ASIC's costs."

The bank said the financial impact of the remediations and the civil penalty and costs orders were covered by existing provisions.


Write to Alice Uribe at alice.uribe@wsj.com


(END) Dow Jones Newswires

10-26-22 0121ET