The corporate watchdog says Westpac has refunded $9.2 million to more than 160,000 customers aged 21 and under after failing to waive fees on savings and transaction accounts over six years.
Between May 2007 and April 2013, savings accounts opened with Westpac and St George were opened without relevant fee waivers being applied.
“Financial institutions that offer products with benefits such as fee waivers must have effective and robust systems in place to deliver the promised benefits to consumers,” ASIC deputy chairman Peter Kell said.
Westpac reported the breach to the Australian Securities and Investments Commission (ASIC).
“Businesses that rely on manual processes to apply waivers, discounts and other benefits should carefully consider how they manage the risks of processes not being followed, including having appropriate controls and procedures in place,” Mr Kell said.
ASIC said Westpac is enhancing its account-opening process, including automated application of relevant fee waivers.
Earlier this month the bank, Australia’s second largest bank by market capitalisation, refunded about $20 million in credit card foreign transaction fees to approximately 820,000 customers.