ANZ has been investigated and publicly sanctioned by the Banking Code Compliance Committee (BCCC), for charging fees and interest to deceased estate accounts. Attwood Marshall Lawyers Commercial Litigation Senior Associate Georgia Taylor, looks at banking misconduct and the recently amended Banking Code of Practice
The Banking Code Compliance Committee (BCCC) is an independent body tasked with monitoring compliance of the Banking Code of Practice, in hand with the Australian Financial Complaints Authority (AFCA). Recently, the BCCC has taken steps to investigate and publicly sanction the ANZ as a reprimand for its systemic misconduct in charging the accounts of deceased customers. Not only did ANZ charge dead people fees between July 2019 and September 2023, but according to the BCCC, ANZ failed to respond to instructions or requests for information from representatives of deceased estates within the 14-day timeframe laid down in the banking code.
“The decision to name ANZ for its non-compliance reflects the seriousness of its Code breaches. Once aware of the issues, ANZ did not act with sufficient urgency to remediate the affected customers. It should have done more to address this more quickly,”
– Chair of the BCCC, Ian Govey AM
The naming of ANZ appears reflective of the banking regulator’s increasing intolerance to banks’ excuses for misbehaviour.
During the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry members of the public submitted more than 10,000 complaints about Australia’s financial services providers and how their misconduct has impacted them financially and emotionally. The harrowing evidence before Commissioner Hayne spread from the likes of ANZ’s internal issues in continuing to profit from the accounts of the deceased to big banks taking homes and in some case livelihoods though irresponsible and fraudulent practices.
Just months after the Royal Commission’s 2019 report, the BCCC investigated financial institutions and voiced their criticism of banks’ poor efforts to hold themselves accountable.
The BCCC’s findings cover the six months following the banking royal commission’s final report. They found more than 20,000 breaches of its Code, with a financial impact of more than $100 million. Further, just two banks accounted for more than 70 per cent of breaches.
At that time, sanctions were not taken against any of the banks. Neither were any of the institutions named nor did the BCCC apply any of the powers it holds to sanction banks, such as forcing staff training, insisting on customers being repaid or referring issues to the Australian Securities and Investments Commission (ASIC). ASIC is responsible for the regulation of the financial services in Australia and has one of the most important regulatory roles within our economy.
Hope on the horizon – increased banking regulation
The Australian Banking Association’s Code of Practice enhancement has been approved by ASIC to strengthen standards and retain key protections for consumers. ASIC has sought to ensure the requirement incumbent upon banks to act with the care and skill of a diligent and prudent banker for consumer borrowers and their guarantors.
Important provisions regarding the handling of consumer complaints and ensuring the robust oversight of the Code by the Banking Code Compliance Committee have also been retained. This includes a new provision that commits subscribing banks to be bound by their obligations under the Banking Code Compliance Committee Charter – a document that explains BCCC’s role, functions and powers to monitor banks’ compliance with the Banking Code of Practice. The enhanced Code also has new provisions for deceased estates, broadens the definition of financial difficulty, and enhances protections for loan guarantors.
The February 2025 Banking Code of Practice will shortly be made available on the ABA’s website.
How to avoid becoming a victim of bad banking behaviour
With our financial services industry continuing to be scrutinized for mismanagement and misconduct, it is incumbent on consumers to monitor and seek external advice before engaging with potentially, life altering financial decisions.
Whilst many issues have been addressed by the Banking Royal Commission, a lot of the 76 recommendations are yet to be adopted into legislature or compliance codes. Thankfully, many of those recommended consumer protections will be enhanced by the February 2025 amendments to the Banking Code of Practice.
However, it is wise to remember people breach Banking Codes of Conduct and legislation. That happens every day. If you want to protect yourself, you need to be on top of your own finances and it’s as simple as checking your bank statements, asking questions at your bank, or having an independent financial advisor.
If you believe that your accounts have been handled inappropriately or that your bank has not met its legal obligations, you have the right to make a complaint directly to the financial institution or the Australian Financial Complaints Authority (AFCA).
Attwood Marshall Lawyers – helping you resolve disputes effectively and recover financial loss
If you are entangled in a dispute with your bank, whether it be about irresponsible lending, being charged excessive fees, or sold unsuitable products, or perhaps you have received poor financial advice, our team can ensure you understand your rights and guide you in resolving the matter as quickly and efficiently as possible.
Our accomplished Commercial Litigation lawyers can determine if you are eligible for compensation for any financial loss you have suffered. In some circumstances, we can accept your case on a “No Win, No Fee” basis* (approved cases only where a veritable financial hardship exists, and claims have a reasonable expectation of success).
For initial advice about your dispute, please call our Commercial Litigation Department Manager, Amanda Heather, on direct line 07 5506 8245, email aheather@attwoodmarshall.com.au or free call 1800 621 071 at any time.
