ANZ Banking Group, ANZ New Zealand’s Australian parent, faces fines of A$240 million after admitting to “unconscionable conduct” in bond dealing services it undertook for the Australian government and “widespread misconduct”\u00a0across products and services affecting nearly 65,000 Australian customers.<\/p>\n
In what the AFR has called the biggest scandal in the ANZ Group’s 182-year history, ANZ and ASIC, the Australian securities and financial conduct regulator, will ask the Federal Court to impose penalties of A$240 million in relation to four separate proceedings spanning misconduct across ANZ\u2019s Institutional and Retail divisions between 2013 to 2023.<\/p>\n
The bond dealing issue concerns a A$14 billion issuance on 19 April, 2023, in which ANZ was assisting the Australian Government\u2019s sovereign debt management agency, the Australian Office of Financial Management (AOFM).<\/p>\n
ASIC says that, instead of trading gradually throughout the day to limit market impact, ANZ sold a significant volume of 10-year Australian bond futures around the time of pricing. placing undue downward price pressure on the bond price.<\/p>\n
“ANZ knew its trading could expose its client to significant risk of harm, but did not disclose to its client that ANZ still had significant volumes to sell before pricing nor provide its client an opportunity to consult with ANZ about delaying pricing,”\u00a0ASIC’s media release<\/a>\u00a0says.<\/p>\n “When the Government later asked what happened, ANZ\u2019s reports were misleading or deceptive.”<\/p>\n The bank also admitted three customer-related issues “across multiple levels and multiple divisions of ANZ” in what ASIC Deputy Chair Sarah Court\u00a0calls “a clear failure to manage non-financial risk.”<\/p>\n Failing to respond to hundreds of customer hardship notices, in some cases for over two years, and failing to have proper hardship processes in place, Better management of non-financial risk was prominent among the aims stated last week by new ANZ Banking Group CEO Nuno Matos as he announced plans to shed around 3,500 Australian staff and up to 1,000 contractors – a move the bank says will result in a A$560 million restructuring charge.<\/p>\n
\n\tMaking false and misleading statements about its savings interest rates and failing to pay the promised interest rate to tens of thousands of customers, and
\n\tFailing to refund fees charged to thousands of dead customers and not responding to loved ones trying to deal with deceased estates within the required timeframe.<\/p>\n