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

 

Company Results: Air NZ Rides The Tourism Boom With Record Full-Year Earnings

Air New Zealand has ridden the tourism boom and staved off increased competition to deliver the best full-year earnings in its 76-year history. More>>

ALSO:

New PGP: Sheep Milk Industry Gets $12.6M Crown Funding

The Sheep - Horizon Three programme aims to develop "a market driven, end-to-end value chain generating annual revenues of between $200 million and $700 million by 2030," according to a joint statement. More>>

ALSO:

Half Full: Fonterra Raises Forecast Milk Price

Fonterra Co-operative Group Limited today increased its 2016/17 forecast Farmgate Milk Price by 50 cents to $4.75 per kgMS. When combined with the forecast earnings per share range for the 2017 financial year of 50 to 60 cents, the total payout available to farmers in the current season is forecast to be $5.25 to $5.35 before retentions. More>>

ALSO:

Keep Digging: Seabed Ironsands Miner TransTasman Tries Again

The first company to attempt to gain a resource consent to mine ironsands from the ocean floor in New Zealand's Exclusive Economic Zone has lodged a new application containing fresh scientific and other evidence it hopes will persuade regulators after their initial application was turned down in 2014. More>>

Wool Pulled: Duvets Sold As ‘Premium Alpaca’ Mostly Sheep’s Wool

Rotorua business Budge Collection Limited (Budge) and sole director, Sun Dong Kim, were convicted and fined a total of $71,250 in Auckland District Court after each pleading guilty to four charges of misrepresenting how much alpaca fibre was in their duvets. More>>

Reserve Bank: Labour Calls For Monetary Policy To Expand Goals

Labour's comments follow a speech today by RBNZ governor Graeme Wheeler in which Wheeler sought to answer critics who variously say he should stop lowering interest rates, lower them faster, or that inflation-targeting should no longer be the primary goal of the central bank's activities. More>>

ALSO:

BSA Extension And Sunday Morning Ads: Digital Convergence Bill Captures Online Content

Broadcasting Minister Amy Adams has today announced the Government’s plans to update the Broadcasting Act to better reflect today’s converged market... The Government considered four areas as part of its review into content regulation: classification requirements, advertising restrictions, election programming and contestable funding. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news