Westpac New Zealand fined $3.25 million for misleading and overcharging customers

Westpac New Zealand has been fined $3.25 million by the country's High Court for misleading customers and overcharging some business clients for over 17 years. The actions by the bank led to $6.35 million in overcharges affecting nearly 25,000 customers between February 2004 and November 2021.

The bank admitted to the breaches in a civil case brought by the Financial Markets Authority (FMA) and reported itself to the agency. The issues stemmed from system deficiencies that led to customers not receiving contractually agreed discounts.

High Court Justice Geoffrey Venning issued a 35% discount to the penalty, acknowledging the bank's self-reporting and cooperation.


The High Court in Auckland heard the case in December 2024.

The FMA said customers entitled to benefits under Employee, Gold and Platinum (EGP) packages did not receive advertised discounts. These packages were offered between February 2004 and November 2021.

The FMA also stated that personal and business banking customers did not receive benefits under Association Packages. The watchdog added that Westpac failed to honor agreed pricing for business customers with Business Transact Accounts.

"Westpac's issues stemmed from deficiencies in its systems that meant the bank failed to deliver contractually agreed discounts to customers," FMA head of enforcement Margot Gatland said.

A Westpac spokesperson said all customers had been remediated and it no longer offered the packages.

Reserve Bank data on December 31, 2024, indicated Westpac was New Zealand's fourth-largest bank by total assets. The bank made a profit of $1.05 billion for the year ended September 2024.