Yahoo Finance Westpac fined $3 million for charging fees for no service
The Federal Court has ordered BT Funds Management and its subsidiary Asgard to pay $3 million in penalties for charging customers fees for no service.
Westpac (WBC.AX) has indicated that it will be paying the penalties and the costs as it acts as the parent company for both BT and Asgard.
This comes after Westpac was also ordered to repay tens of thousands of Aussies up to $87 million after failing to notify its customers of crucial investing opportunities between 2005 and 2019.
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A total of 404 Aussies were harmed by their conduct between September 2014 and August 2017, the Court found.
The Court also determined the companies had engaged in misleading or deceptive conduct by providing customers with account statements which failed to show that they were continuing to deduct an ongoing adviser fee from customers’ accounts, even after those customers requested to remove their financial advisers from their accounts.
The Court also found Asgard had breached its obligation to do all things necessary to ensure the financial services covered by its financial services licence were provided efficiently, honestly and fairly, corporate watchdog ASIC said.
“Misleading statements were made to customers, who were also charged for services they did not receive,” said ASIC Deputy Chair Sarah Court.
“The licensed financial services industry has an obligation to ensure that their systems and processes are reliable, accurate and their customers must be able to have trust in them.”
In his orders, Justice Wheelahan said financial services providers should be more responsible in making sure they are not unduly charging customers for services that they do not need or require.
“An appropriate penalty should have the effect of deterring the defendants, and financial services providers generally, from maintaining defective systems, and conversely, providing an incentive to establish and maintain systems that are reliable,” he said.
The Court also acknowledged the preparedness of BT and Asgard to make early admissions of liability and took this into account in determining the penalty.
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