New Zealand's High Court has ruled against ANZ in a significant class action lawsuit, finding the bank breached credit disclosure laws and faces potential liabilities up to $125 million in a decision that could reshape banking accountability across the Tasman.
The ruling, reported by RNZ, concerns a coding error between 2015 and 2016 that caused ANZ to undercharge roughly 17,000 mortgage customers about $2 monthly. The bank self-reported the issue and paid over $35 million in remediation.
But the court found that under New Zealand's strict Credit Contracts and Consumer Finance Act, disclosure failures require refunding all interest and fees charged during non-compliance periods - regardless of whether customers were financially harmed.
That interpretation is what creates the massive potential liability. ANZ had already made customers whole. Now it may owe dramatically more under a legal standard that prioritises compliance over actual consumer harm.
The decision echoes an earlier case where ASB settled for $135.6 million over similar disclosure breaches. Big banks are discovering that New Zealand's consumer credit laws have sharp teeth.
ANZ operates across both Australia and New Zealand, and the precedent matters for banking regulation throughout the region. The ruling reinforces that technical compliance with disclosure rules isn't optional - even minor errors can trigger enormous penalties.
Mate, this is a win for consumer rights against big banks. But it also raises questions about whether the legal remedy is proportionate when the bank's error actually left customers better off.
The New Zealand government is already considering legislative changes to clarify remedies for pre-2019 breaches, acknowledging that current law may create perverse outcomes. Banks want certainty. Consumer advocates want accountability.
ANZ can appeal, and likely will given the stakes involved. The case will wind through courts for years. But the High Court decision establishes that banks can't assume minor technical violations will be treated leniently.
For the roughly 17,000 affected ANZ customers, the ruling means potential compensation beyond what they've already received. For the banking sector, it's a warning that compliance failures - even inadvertent ones - carry serious consequences in New Zealand's regulatory environment.
