The Federal Court of Australia found the Commonwealth Bank of Australia (CBA) provided false or misleading information to its customers.

On 6 April 2021, Justice Lee of the Federal Court ordered CBA to pay a penalty of $7 million to the Commonwealth for providing false or misleading information to 1,510 customers with Simple Business Overdraft and Business Overdraft accounts.

CBA sent statements to the customers which showed that a particular interest rate had been charged. However, the statements were false or misleading because CBA had charged the customers interest at a significantly higher rate – often double the rate referred to in the statement. This happened in 12,119 account statements between 1 December 2014 and 31 March 2018.

By overcharging interest, CBA also broke the terms and conditions of its contracts with the customers.

The customers were overcharged interest totalling $2,238,554.94.

CBA acknowledges it took longer than it should have to rectify the issue after first being alerted to it by a customer complaint.

The customers have been remediated.

The Court ordered CBA to publish this Misconduct Notice.

Further information

For further information, visit ASIC’s media release here.

See the Court’s judgment here.