CommInsure, the Commonwealth Bank’s life insurance unit, has been charged with 87 counts of unlawfully selling life insurance policies over the phone.
The maximum penalty for each of the charges is $21,250, or $2.7 million in total.
The Australian Securities and Investments Commission alleges that CommInsure, through its agent, telemarketing firm Aegon Insights Australia, unlawfully sold the life insurance policies known as Simple Life between October and December 2014.
CommInsure, a wholly-owned subsidiary of the Commonwealth Bank, provided customer contact details to Aegon from CBA’s existing customer database, according to the corporate watchdog.
ASIC alleges that the calls were unsolicited, and didn’t comply with all of the hawking exceptions in the law, ASIC said in a statement.
The Commonwealth director of public prosecutions, which is prosecuting the case, said it was unable to comment on matters before the courts.
Commonwealth Bank said in a news release that the telephone sales of the Simple Life product ceased at the end of 2014.
While there was initial speculation the charges stemmed from the royal commission, Commonwealth Bank said they were unrelated and that CommInsure had reported breaches of the anti-hawking provisions to ASIC.