ASIC chair tells banks to put customers first | The Business | ABC NEWS

ASIC’s new top cop has a stern message for the banks, telling them to put customers first and get back to basics.

In one of Sarah Court’s first sit down interviews since taking on the role of ASIC chair, she told Kirsten Aiken she does not want the corporate regulator or Australia’s banks to forget the lessons of the Banking Royal Commission.

It comes as ASIC reveals its investigation of eight banks, representing more than 70 per cent of Australia’s home loan market, found weaknesses across all of them in how offset accounts were set up, monitored and managed.

Millions of Australians use mortgage offset accounts to reduce interest costs on their home loans, but the corporate regulator says some banks are not delivering the savings as promised.

Australian banks have paid more than $55 million in compensation in just two years, after failures with offset accounts left customers paying more interest than they should have, the review by ASIC found.

ASIC chair Sarah Court said the problems could be particularly difficult for borrowers to detect because mortgage repayments may stay the same, masking the fact they are paying more interest than they should. “So we think there is real work for the banks to do to improve their systems to get this right and we saw disturbing individual examples … one customer lost or paid more than $3,500 in extra interest over just a one month period where the bank had in error delinked their offset account from their mortgage,” she said.

“One of the things I’ve been saying to the banks … I do not want either ASIC or the banks to forget the lessons of the Royal Commission. And you know, harking back to that time, we saw lots of examples of banks failing to get the basics right, charging the wrong interest rates, charging fees to dead people, dealing with hardship applications.”

In this interview, Sarah Court explains why audit firms should face tough regulation as well as ASIC’s drive to make better use of intelligence and data sets to crackdown on sham and failed investment schemes more quickly.
#ABCBusiness
Subscribe: http://ab.co/1svxLVE

Note: In most cases, our captions are auto-generated.

#ABCNEWS #ABCNEWSAustralia