Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Why is Charging Kiwis More Standard Business Practice?

15 March 2013

“Fair Play on Fees” Invites ASB to Tell Kiwis Why It is Standard Business Practice to Charge Kiwis More

The lawyer pursuing Kiwi banks on behalf of customers overcharged hundreds of millions in unfair bank fees has called on one of the country’s biggest financial institutions to explain why the head of its Australian parent company justified the overcharging as “standard business practice”.

Ian Narev, who is head of the Commonwealth Bank of Australia – owner of ASB – told a business lunch in Auckland yesterday that it was ”standard business practice” to charge higher default fees in New Zealand than in Australia.

The comment was made in response to Fair Play on Fees comparison of the fees charged by ASB in NZ and CBA in Australia. In New Zealand, ASB customers are charged more than three times the amount charged in Australia when an automatic payment (AP), bill payment or direct debit is declined.

An ASB customer in New Zealand is charged a fee of $20 but the same customer of the CBA in Australia is charged $NZD6.25 ($AUD5).

Fair Play on Fees Lawyer Andrew Hooker says Kiwis were entitled to ask ASB how such disparity can be justified as a “standard business practice”.

“Customers are entitled to know why there is such a vast difference. Surely the costs of the same computer transaction in NZ can’t be three times higher than what it is in Australia. Do computers cost that much more here than in Australia?"

”We understand the bank’s point that there is no reason for fees and charges to be identical between countries but the differences just don’t add up. It is time for ASB to give its customers more information about the costs that go into a making up a default fee”.

Mr Hooker said “Perhaps Mr Narev doesn’t understand what the case is about. If a can of Coke in Australia costs slightly more than in NZ, big deal, if their monthly account keeping fees are slightly higher or lower, then big deal. The issue with these particular fees is that they need to be set with regard to what it actually costs the bank when a customer has insufficient funds to meet an AP. We say that the costs of this occurring are out of all proportion to the fees that they are charging; that’s what makes it an unlawful penalty. It seems that this principle is better understood by Mr Narev’s CBA team in Australia but less well understood by their colleagues across the Tasman”.

New Zealanders can join the action against unfair bank fees by registering at www.fairplayonfees.co.nz.

ENDS

About Andrew Hooker

Andrew is an Auckland based lawyer specialising in civil litigation. He has more than 20 years’ experience in litigation. His current practice largely involves representing customers against their insurance companies.

About Slater & Gordon

Slater & Gordon is Australia’s largest consumer law firm. For 75 years, Slaters have been standing up for the rights of ordinary working people, not big companies. Slater & Gordon have been pioneers in Australian class actions over the past 25 years. They will be lending their expertise in tough, largescale litigation to this case as legal advisors.

About Litigation Lending Services (NZ)

Litigation Lending Services (NZ) Limited is a litigation funding firm which will provide financial support to the case. Its parent company, Litigation Lending Services Limited, has been operating for over 13 years in both Australia and New Zealand. Having established itself funding general commercial claims, the company has expanded over the past five years and has also funded a number of successful class actions.


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Fruit & Veg Crackdown: Auckland Fruit Fly Find Under Investigation

The Ministry for Primary Industries (MPI) is investigating a find of a single male Queensland fruit fly in a surveillance trap in the Auckland suburb of Grey Lynn... MPI has placed legal controls on the movement of fruit and some vegetables outside of a defined circular area which extends 1.5km from where the fly was trapped in Grey Lynn. More>>

ALSO:

Scoop Business: Westpac NZ Reaches $2.97M Swaps Settlement

Westpac Banking Corp’s New Zealand unit has agreed to pay $2.97 million in a settlement with the Commerce Commission over the way the bank sold interest rate swaps to farmers between 2005 and 2012. More>>

ALSO:

Going Dutch: Fonterra Kicks Off $144M Partnership With Dutch Cheese Maker

Fonterra Co-operative Group, the world’s largest dairy exporter, has commissioned a new dairy ingredients plant in Heerenveen, in the north of the Netherlands, its first wholly-owned and operated ingredients plant in Europe. More>>

ALSO:

Scoop Business: NZ Retail Sales Beat Estimates

New Zealand retail sales rose more than expected in the fourth quarter, led by vehicle-related transactions, food and beverages, adding to evidence that cheap credit and a growing jobs market are encouraging consumers to spend. More>>

ALSO:

Delivery Cuts Go Ahead: 'Government Money Grab' From NZ Post

"It's a money grab by the Government as the shareholder of New Zealand Post" says Postal Workers Union advocate Graeme Clarke about the changes announced by NZ Post. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news