Westpac Bank has admitted to overcharging nearly 25,000 customers a total of $6.3 million by failing to deliver promised discounts and benefits tied to specialised banking packages.
The Financial Markets Authority (FMA) initiated civil proceedings against the bank, revealing that deficiencies in Westpac’s systems prevented the application of agreed-upon preferential pricing.
These lapses affected both retail and business customers, with up to 43 percent of personal clients and 32 percent of business clients being overcharged.
The FMA cited manual record-keeping and inadequate staff training as key contributors to the errors, which often left eligible customers unaware they were paying higher fees than promised.
In a statement, Westpac acknowledged the historical issues and confirmed that impacted customers have since been compensated.
The bank said it self-reported the errors to the FMA and cooperated fully with the investigation.
However, the incident highlights broader concerns about financial institutions’ accountability, as the FMA has recently penalized several other banks and insurers, including ANZ and Kiwibank, for similar misconduct.
The High Court is set to determine Westpac’s penalty for these breaches next year.
Oops, sorry about the $6.3M…..how many of us could do that?