ANZ Bank Faces Record $240 Million Fine for Widespread Misconduct

ANZ Group Holdings Ltd. has agreed to pay a record A$240 million ($160 million) fine, the largest ever imposed by the Australian Securities and Investments Commission (ASIC) on a single entity. This penalty stems from multiple investigations into systemic failures across both its institutional and retail banking operations. The misconduct includes acting "unconscionably" during a A$14 billion government bond issuance, misreporting bond trading data, failing to respond to customer hardship notices, and mishandling deceased estates, affecting nearly 65,000 customers.

ANZ faces largest ever ASIC penalty for misconductThe Straits TimesReuters

ASIC's investigations revealed that ANZ overstated bond trading volumes by tens of billions of dollars and misled the government regarding trading turnover data for nearly two years. This behavior placed undue downward pressure on bond prices, costing the government approximately A$26 million. Additionally, ANZ failed to respond to 488 customer hardship notices between May 2022 and September 2024, sometimes for over two years, and continued to charge fees to thousands of deceased customers due to inadequate systems for identifying which fees should be waived.

ANZ faces largest ever ASIC penalty for misconduct

ASIC Chair Joe Longo emphasized the seriousness of ANZ's misconduct, stating, "This outcome shows an unacceptable disregard for that trust that is critical to the banking system." ANZ Chairman Paul O'Sullivan acknowledged the bank's failures, stating, "On behalf of ANZ, I apologize and assure our customers we have taken the necessary action, including holding relevant executives accountable." New CEO Nuno Matos, who recently announced 3,500 job cuts, indicated that significant changes are necessary to restore customer trust and improve operational practices.

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Critics have pointed out that ANZ's repeated failures reflect deep cultural issues within the bank. ASIC Deputy Chair Sarah Court remarked, "The issues we have seen reflect serious inadequacies across multiple levels and multiple divisions of ANZ." The Finance Sector Union has also announced plans to lodge a claim against ANZ for the recent job cuts, highlighting concerns over employee treatment amid the bank's restructuring efforts.

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The penalties are subject to approval by the Federal Court, and ANZ is expected to submit a remediation plan to the Australian Prudential Regulation Authority by the end of September 2025. The bank anticipates spending A$150 million on reforms in the financial year ending September 30, 2026. ANZ's future strategies will likely focus on improving risk management and compliance to prevent further violations and regain customer trust.

The Straits Times

• “This is very serious unconscionable conduct,” — Joe Longo, ASIC Chair

CityLab

• “the reality is we made mistakes that have had a significant impact on customers” — Paul O'Sullivan, ANZ Chairman

The Straits Times

• “Trust is vital to banking,” — Sarah Court, ASIC Deputy Chair

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• “Today's announcement reinforces the fact that change is needed, and that we need to operate in a different way than in the past,” — Nuno Matos, ANZ CEO

Reuters