Westpac has been ordered to pay a combined penalty of $113 million for what a Federal Court judge has described as "widespread compliance failures".
Justice David Beach today penalised Westpac $40 million for charging advice fees to over 11,800 deceased customers, marking the final judgement of six separate civil penalty proceedings against the bank.
Other judgements previously made by the court included rulings on the bank's duplication insurance policies (fined $15 million), failure to disclose fees (fined $6 million) and allowance of deregistered company accounts to remain open (fined $20 million).
Westpac was also fined $12 million for charging higher interest rates on credit cards and fined $20 million for charging customers commissions that had been banned.
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Australian Securities and Investments Commission (ASIC) Deputy Chair Sarah Court said the court's decisions reflected a profound problem with Westpac's internal culture.
"The breaches found by the Court in these six cases demonstrate a profound failure by Westpac over many years and across many areas of its business to implement appropriate systems and processes to ensure its customers were treated fairly," Ms Court said.
"Westpac, like all licensees, has an obligation to be honest and fair in its provision of financial services. Despite this, Westpac failed to prioritise and fund the systems upgrades necessary to help fulfil this obligation."
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Ms Court said huge numbers of Australians had been affected by Westpac's failure to have adequate processes in place to comply with the relevant laws.
"Over the course of 13 years, more than 70,000 customers have been affected by these failures, either by being incorrectly charged or given the wrong information," she said.
"The sheer scale of this impact suggests that, at the time, Westpac had a culture that did not prioritise compliance."
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While Westpac is the parent company, the six judgements affect a number of Westpac businesses including BT Funds Management, Magnitude Group and Asgard Capital Management Limited.
In a statement to 9News.com.au Westpac apologised to customers and said the $113 million in penalties have been provisioned in the banks full year 2021 results.
"Westpac acknowledges that the Federal Court has now heard all six civil penalty proceedings which were commenced by ASIC in November 2021 and ordered penalties in the amounts agreed with ASIC and previously disclosed," a spokesperson for the bank said.
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"In November 2021, Westpac announced it had reached agreement with ASIC to resolve six separate longstanding matters through agreed civil penalty proceedings filed in the Federal Court of Australia. The issues are all previously disclosed.
"Westpac and ASIC jointly submitted agreed proposed penalties for each of the proceedings, totalling $113 million. These penalties have been substantially provisioned (together with anticipated legal costs) in Westpac's Full Year 2021 results.
"Westpac again apologises to all affected customers. Remediation is now complete or substantially progressed."
