1. Executive summary
In Australian Securities and Investments Commission v Australia and New Zealand Banking Group Limited (Retail Cases Omnibus) [2025] FCA 1593, Beach J approved agreed declarations and imposed total pecuniary penalties of $115 million across three proceedings concerning:
- deficient processes for identifying and responding to customer hardship notices;
- misleading representations and inadequate systems concerning promotional bonus interest; and
- inadequate deceased-estate processes, including delays and the charging or non-refund of fees.
The penalties comprised:
| Proceeding | Conduct | Penalty |
|---|---|---|
| Hardship notices | Inadequate hardship processes and late responses | $40 million |
| Bonus interest | Misleading representations and systems failures | $40 million |
| Deceased estates | Inadequate bereavement systems, training and monitoring | $35 million |
| Total | $115 million |
The Court also ordered ANZ to publish adverse publicity notices on its public websites and secure online-banking login page and to pay ASIC’s costs in each proceeding. The judgment was delivered on 19 December 2025 following hearings on 2 and 3 December 2025.
The decision is significant because it treats the three matters as manifestations of a broader operational-governance problem: customer promises and statutory obligations were not translated into adequate systems, controls, records, training, monitoring and timely remediation. Although ANZ did not deliberately engage in the conduct and senior management was not found to have participated in the contraventions, the Court regarded the failures as serious and requiring penalties that could not be treated as a cost of doing business.
2. Citation and context
Case: Australian Securities and Investments Commission v Australia and New Zealand Banking Group Limited (Retail Cases Omnibus)
Neutral citation: [2025] FCA 1593
Court: Federal Court of Australia
Judge: Beach J
Judgment date: 19 December 2025
Hearing dates: 2 and 3 December 2025
Proceedings: VID 1209, VID 1210 and VID 1211 of 2025
Registry: Victoria
Nature of decision: Agreed declarations, pecuniary penalties, adverse publicity and costs orders across three retail-banking proceedings.
The judgment proceeded on statements of agreed facts and admissions. The Court nevertheless independently assessed whether the proposed declarations and penalties were appropriate.
3. Proceeding 1 — hardship notices
Conduct
Between September 2019 and September 2023, ANZ failed to maintain adequate processes for recording and responding to hardship notices received through branches, call centres, the ANZ App’s “Message Us” channel and external mobile lenders.
In some channels, frontline staff could provide information or forms to a customer without connecting the customer to the hardship team or recording that a hardship notice had been given. This created a material risk that ANZ would not issue the written response required by s 72 of the National Credit Code. In some channels, the number of resulting failures could not be quantified because ANZ did not maintain reviewable records.
For hardship notices received through Message Us between May 2022 and September 2024, ANZ admitted:
- at least 488 and as many as 668 initial contraventions of s 72(4); and
- at least 185,283 and as many as 248,546 continuing daily contraventions under s 175A of the National Consumer Credit Protection Act 2009 (Cth).
Beach J observed that the contraventions might have continued without ASIC’s targeted review.
Customer impact
The affected customers were experiencing or anticipating financial difficulty, including because of unemployment, illness, bereavement, separation and abuse. Delayed responses could compound both financial pressure and distress, particularly where notices remained unanswered for months or years.
ANZ reviewed 1,853 potentially affected customers and identified 587 eligible for remediation. It paid approximately $92,688, including fee reversals, debt waivers, small-balance write-offs and compensation for non-financial loss, and also corrected some credit records.
Findings and penalty
ANZ contravened:
- ss 47(1)(a) and 47(4) of the Credit Act by failing to ensure that credit activities were engaged in efficiently, honestly and fairly; and
- s 72(4) of the National Credit Code by failing to provide timely written responses.
The Court imposed:
- $15 million for the general credit-licensee obligation contravention; and
- $25 million for the s 72 contraventions.
4. Proceeding 2 — bonus interest and rate promotion
Bonus interest representations
ANZ promoted deposit accounts on the basis that eligible customers would receive a specified introductory bonus interest rate for a defined period.
The Court declared that ANZ made misleading or false representations because:
- it knew of bonus-interest payment issues affecting business accounts from April 2015 and retail accounts from October 2022;
- it failed to investigate and rectify the issues promptly;
- its systems and monitoring were inadequate; and
- 8,301 customers who opened eligible accounts during the penalty period did not receive the promised bonus interest.
The representations were not limited to an express promise to pay interest. ANZ also implied that it had adequate processes to ensure the promised interest would be paid. That implied process representation was misleading because the necessary operational controls were deficient.
Incorrect rates on application pages
Between 27 August 2024 and 17 March 2025, ANZ displayed incorrect introductory interest rates on two online application pages. The rates had been hard-coded as static numbers rather than dynamic fields and were not checked when rates changed.
Approximately 56,703 customers opened accounts through the affected process. Of these, 26,917 accounts had a positive balance and were financially affected. The unpaid amount, including time-value adjustments, was approximately $502,084.
Remediation
ANZ’s broader remediation for the bonus-interest issue included approximately:
- $7.85 million paid in relation to 194,487 accounts across the broader period from July 2013 to January 2024; and
- $143,100 paid to 8,301 accounts within the penalty period.
The Court treated the figures as the best available proxy for customer impact because the precise number of customers who saw the promotional statements could not be established.
Findings and penalty
ANZ contravened:
- s 12DA(1) of the Australian Securities and Investments Commission Act 2001 (Cth);
- s 12DB(1)(e) of the ASIC Act; and
- ss 912A(1)(a) and 912A(5A) of the Corporations Act 2001 (Cth).
The Court imposed:
| Conduct | Penalty |
|---|---|
| Bonus-interest representations and process representations | $25 million |
| Incorrect rates displayed on application pages | $5 million |
| General AFSL systems and monitoring failures | $10 million |
| Total | $40 million |
A critical legal point is that misleading conduct does not require proof of intention or proof that a particular customer was actually misled. The Court assesses the dominant message conveyed to an ordinary and reasonable member of the relevant class.
5. Proceeding 3 — deceased estates
Banking Code obligations
The proceeding concerned obligations under Chapter 45 of the Banking Code of Practice, including requirements to:
- respond to specified notifications or requests from deceased-estate representatives within 14 days; and
- stop, waive or refund certain fees following notification of a customer’s death.
Those contractual obligations engaged ANZ’s statutory duties under its AFSL and Australian credit licence.
Systems and governance deficiencies
From July 2019 until June 2023, ANZ lacked adequate:
- documented guidance;
- staff training;
- systems to identify matters subject to the 14-day or fee obligations;
- controls to confirm that fees had been stopped or refunded;
- quality assurance;
- monitoring and breach reporting.
The Court declared that these deficiencies contravened ss 912A(1)(a) and 912A(5A) of the Corporations Act and ss 47(1)(a) and 47(4) of the Credit Act.
Customer and estate impact
The full impact could not be identified because ANZ’s systems did not record relevant requests and outcomes adequately.
Known indicators included:
- a backlog of 7,329 deceased-estate cases in February 2022;
- customers being told to expect delays of six to eight weeks;
- a September 2022 internal-audit sample in which the 14-day obligation was not met in 39% of tested estates;
- 469 reported breaches in the first half of 2023 and 753 in the second half;
- 2,878 complaints potentially related to delays or fee failures; and
- likely additional emotional distress for bereaved representatives.
ANZ’s remediation included:
- approximately $667,880 paid to 1,421 estates for interest that may have accrued because of delay;
- apology letters to 9,137 estates;
- refunds of 2,227 impermissible fees totalling approximately $158,004; and
- a broader total of approximately $3.2 million paid to 17,556 estates in relation to fees, interest and time-value adjustments.
Penalty
The Court imposed a total penalty of $35 million for the deceased-estate contraventions.
Beach J stated that the penalty reflected the “serious and unacceptable nature” of the contraventions and ensured that they were not regarded as a cost of doing business: at [453].
6. Contraventions summary
| Area | Act | Provision | Duty or prohibition | Finding |
|---|---|---|---|---|
| Hardship processes | Credit Act | ss 47(1)(a), 47(4) | Credit activities must be engaged in efficiently, honestly and fairly | Contravened |
| Hardship responses | National Credit Code | s 72(4) | Timely written response to hardship notices | At least 185,771 and up to 249,214 total initial and continuing contraventions in Message Us |
| Bonus interest | ASIC Act | s 12DA(1) | Misleading or deceptive conduct | Contravened |
| Bonus interest | ASIC Act | s 12DB(1)(e) | False or misleading representation that services have benefits | Contravened |
| Deposit-account systems | Corporations Act | ss 912A(1)(a), 912A(5A) | Financial services must be provided efficiently, honestly and fairly | Contravened |
| Deceased estates | Corporations Act | ss 912A(1)(a), 912A(5A) | Adequate systems for deposit-account services | Contravened |
| Deceased estates | Credit Act | ss 47(1)(a), 47(4) | Adequate systems for loan and credit-account activities | Contravened |
7. Key legal and compliance principles
Customer promises create systems obligations
A representation that a customer will receive a product benefit can also imply that the institution has adequate processes to deliver it. Marketing, product terms, account opening and back-office fulfilment must therefore operate as one controlled system.
Efficient, honest and fair obligations are operational
The statutory obligations in s 912A and s 47 are not confined to dishonest conduct. They may be contravened by prolonged deficiencies in procedures, training, data, quality assurance and monitoring.
Recordkeeping failures increase legal exposure
In the hardship and deceased-estate matters, deficient records prevented ANZ and ASIC from determining the full number of affected customers or contraventions. Poor records are therefore not merely an evidentiary inconvenience; they can demonstrate that the regulated process itself was inadequately controlled.
Continuing contraventions can multiply rapidly
Each day that a hardship response remained outstanding generated an additional contravention. An unresolved operational defect can therefore create rapidly increasing legal exposure even where the affected customer cohort is comparatively small.
Vulnerability increases seriousness
The Court gave particular weight to impacts on customers experiencing financial hardship and on bereaved estate representatives. Financial institutions should treat hardship and deceased-estate functions as high-risk customer-outcomes processes requiring enhanced controls and escalation.
8. Governance implications
The judgment demonstrates that boards and executives should not rely on policy attestations or high-level management reporting without evidence that customer-level obligations are being performed.
Key governance expectations include:
- end-to-end reconciliation of customer promises against benefits delivered;
- channel-by-channel testing of regulated workflows;
- systems that prevent a case from closing without required action;
- monitoring of customer communications, not merely product terms;
- accurate and reviewable records;
- executive escalation of backlogs and known control failures;
- prompt root-cause investigation once an issue is identified; and
- validation that corrective controls operate after implementation.
The fact that hardship failures continued after tactical and strategic solutions had been introduced illustrates the need for post-implementation assurance. Between 371 and 516 initial hardship contraventions occurred after those measures were implemented.
9. Orders and remedies
| Order or remedy | Scope |
|---|---|
| Hardship penalties | $40 million |
| Bonus-interest penalties | $40 million |
| Deceased-estate penalty | $35 million |
| Total penalties | $115 million |
| Adverse publicity | Public website, newsroom and secure banking login for at least 90 days |
| Costs | ANZ to pay ASIC’s costs in each proceeding |
| Compliance program | No separate order; Court noted an ASIC-overseen program was already operating |
The Court accepted the existing compliance program after receiving further affidavit evidence and did not consider a separate program order necessary.
10. Recommended controls
| Audience | Control type | Risk indicator | Practical control |
|---|---|---|---|
| Board risk committee | Governance | Repeated retail-banking failures across products | Receive cross-product customer-obligation reporting |
| Product owners | Preventative | Promised benefits depend on manual coding | Automate benefit application and exception blocking |
| Digital teams | Preventative | Customer-facing rates stored as static text | Use dynamic source-of-truth fields and automated validation |
| Hardship operations | Preventative | Notice received outside specialist team | Create mandatory enterprise-wide capture and referral |
| Compliance | Detective | Cases closed without statutory response | Daily reconciliation and continuing-breach reporting |
| Bereavement team | Preventative | Requests and fees not identifiable | Create coded workflows, deadlines and mandatory checklists |
| Data governance | Detective | Impact cannot be quantified | Retain searchable interaction and outcome records |
| Change management | Governance | Fix implemented but not followed | Post-implementation testing and frontline observation |
| Internal audit | Detective | Backlogs or repeated manual overrides | Conduct thematic customer-outcomes assurance |
| Remediation | Corrective | Incomplete customer data | Use reasonable proxies, conservative assumptions and board-approved methodology |
11. Recommended next steps
ANZ and comparable institutions should:
- inventory all statutory, contractual and advertised customer promises;
- identify the operational system responsible for delivering each promise;
- reconcile actual outcomes against customer eligibility and entitlement;
- review every channel through which hardship or vulnerability may be communicated;
- identify workflows that permit closure without a statutory or contractual outcome;
- audit static customer-facing product data and rates;
- establish customer-level monitoring for bonus benefits and fee reversals;
- test deceased-estate controls against Banking Code obligations;
- quantify continuing contraventions and escalate them immediately; and
- report recurring cross-product control failures to the board as an enterprise systems-risk issue.
12. Broader impact
The judgment is a major operational-risk warning for banks and other financial institutions. It shows that failures across hardship, interest payments and deceased-estate administration may be treated as separate legal breaches but also as evidence of a broader governance problem: customer promises and statutory duties were not translated into reliable systems, records, training, monitoring and escalation. Boards should therefore assess recurring control failures across products and channels as an enterprise-wide customer-outcomes risk, rather than as isolated incidents.
The decision also confirms that substantial penalties may follow without deliberate misconduct or direct senior-management involvement. Poor recordkeeping, weak workflow design, static digital content and ineffective post-implementation testing can themselves create serious regulatory exposure, particularly where affected customers are financially vulnerable or bereaved. Institutions must be able to prove, at customer level, that obligations were identified, completed on time and accurately recorded.
More broadly, the $115 million combined penalty raises the benchmark for retail banking compliance and remediation. It reinforces that continuing contraventions can escalate rapidly, advertised benefits may imply adequate delivery systems, and incomplete data will not shield an institution from liability. Regulated entities should map all customer promises to accountable operational controls, independently test remediation fixes and escalate repeated cross-product failures to the board.
This analysis is suitable for internal legal, governance and compliance review, but final positions should be confirmed against the complete judgment, current legislation and any subsequent appellate or regulatory developments.