Why ANZ is refunding $28.8 million in fees
Failure to disclose periodical payments charges has proved costly.
ANZ will refund $28.8 million in fees to retail and business bank customers after charging customers for "periodical payments" even when customers were moving money between their own accounts.
The refunds will be issued to 376,570 individual customers and 17,230 business accounts, and include $3 million in interest penalties.
The issue? ANZ charged fees for setting up regular periodical payments from its accounts, including if those resulted in an account being overdrawn, which is not uncommon. However, its terms and conditions specified that those fees only applied when making a transfer to "another person or business", meaning transfers to accounts in the same name (such as moving money from a transaction account to a high-interest savings account) should not have attracted fees, but did.
After identifying the issue, ANZ proactively reported the issue to the Australian Securities and Investments Commission (ASIC). In a statement, ASIC noted "the cooperative approach taken by ANZ in its handling of this matter, and its appropriate reporting of the matter". ANZ has since updated its terms and conditions to more clearly state where fees apply.
ANZ is contacting customers who are affected by the issue, and says refunds will be issued by the end of September. In most cases, the total fee refunds are less than $50, ANZ said, and 192,000 refunds have already been issued.
The issue highlights the importance of picking an account that can help minimise your fees.
Picture: Sunflowerey / Shutterstock.com
