Australian regulator says banks paid $3.10 billion in compensation for wrongly charged fees

(Reuters) – Australia’s corporate watchdog said the country’s six largest banking services providers have paid or offered A$4.7 billion ($3.10 billion) in compensation to customers who suffered losses for fees charged for services that were not provided.

The Australian Securities and Investments Commission (ASIC) said on Friday it undertook a review of the systems which led to wrongful fees being charged by the country’s four biggest banks – Commonwealth Bank of Australia (OTC:), Westpac Banking (NYSE:), ANZ Group and National Australia Bank (OTC:) – plus investment bank Macquarie Group (OTC:) and wealth manager AMP (OTC:) Ltd.

The watchdog’s order for customer compensation came at a time when each of the ‘Big Four’ – which account for the majority of lending in Australia – are being closely scrutinised for abusing their market dominance in the wake of scandals involving misleading financial advice, insurance fraud and interest-rate rigging.

The largest business lender in Australia, NAB, took the lead and coughed up A$1.49 billion in compensation as of the end of 2022, followed by CBA and Westpac coughing up a payout of A$1.13 billion and $1.03 billion, respectively.

ASIC said its final update on remediation figures “draws a line” under its eight-year long programme of addressing financial institutions’ failure to provide ongoing services to fee-paying customers.

($1 = 1.5177 Australian dollars)