Federal Court throws out ASIC’s case against CBA

The regulator had alleged that CBA incorrectly charged monthly access fees to customers who were entitled to fee waivers because they met certain criteria under their contracts with the bank.

Almost $55 million in fees were charged to nearly 1 million customers and more than 800,000 accounts.

ASIC’s deputy chair Sarah Court said the regulator pursued this case because it believed CBA did not have robust compliance systems to ensure customers were being correctly charged.

“ASIC will carefully consider the judgment and continue to work to ensure large financial institutions charge fees correctly and put their customers first,” Ms Court said.

In relation to fees incorrectly charged and recorded, the Federal Court found that on a customer’s bank statement, the only representation by CBA was that a fee of a particular amount had been charged on or around the nominated date and that “the customer should check whether the entry was correct” and notify CBA in the event of any error.

The court also found that CBA did not represent that it would have adequate systems and processes in place to ensure that it could and would provide the applicable fee waiver when it entered into a contract with a customer to establish an account.

Rather, CBA’s terms and conditions acknowledged that sometimes the bank “can get things wrong, and when this happens” the bank is “determined to make them right again”.

The court also found that CBA had “not breached its general obligation” to do all things necessary to ensure that the financial services covered by its licence were provided efficiently, honestly, and fairly.

While the case had been dropped, the major bank had received approximately 14,000 complaints from customers about the fee overcharging from June 2010 to May 2019, the regulator said.

CBA identified the problems with its systems that caused the overcharging in January 2011 and notified ASIC in December 2018, which followed the first of a number of breach reports with ASIC in May 2019.

“CBA has undertaken remediation for the majority of customers impacted by the incorrect fee charging,” ASIC said.

As at 13 September 2021, CBA had paid approximately $64 million in remediation to almost 1 million customers who were overcharged, but some customers have not been remediated, the regulator said.

[Related: CBA class action goes to Federal Court]