Source: Radio New Zealand
The Co-operative Bank self-reported the breaches under the Credit Contracts and Consumer Finance Act. Supplied/Co-operative Bank
The Co-operative Bank has been penalised nearly $2.5 million by the High Court for overcharging its customers.
It comes after the bank admitted to the breaches last year after reaching a settlement with the Commerce Commission.
The commission said the bank overcharged just over 48,000 customers approximately $7.225 million, which has since been remediated.
The Co-operative Bank self-reported the breaches under the Credit Contracts and Consumer Finance Act, and accepted the overcharging occurred after a series of compliance and process failures.
“Investing in compliance and rigourously auditing processes and controls is a crucial step towards avoiding an investigation, court action and a hefty penalty,” Commerce Commission director of credit Sarah Bartlett said.
The commission said the bank charged 12 “unreasonable fees” across its lending products involving its home and personal loans, with most being charged between June 2015 and November 2021.
In her judgement, Justice Victoria Heine noted the circumstances behind the breaches varied from fee to fee. However, they suggested “there was a fundamental failure within Co-operative at that time to appreciate what was needed to comply with the fees provisions”.
“I am satisfied that the penalty proposed is sufficient to contribute to deterring others from running the risk of non-compliance,” she said.
Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
