ComCom investigates BNZ over CCCFA disclosure breaches
By Jenny Ruth
May 27 (BusinessDesk) - The Commerce Commission has told Bank of New Zealand it has commenced an investigation into BNZ’s compliance with particular disclosure requirements under the Credit Contracts and Consumer Finance Act 2003.
BNZ discloses the investigation’s existence in its latest disclosure statement and says “the bank intends to fully comply with the Commerce Commission’s request for the bank to supply additional information to support its investigation. The potential outcome of the investigation remains uncertain.”
BNZ says it has been reviewing its compliance with the CCCFA since 2015 with a particular focus on disclosure requirements and has refunded some customers.
“As part of this process, in late 2018, the bank provided information to the Commerce Commission in relation to issues identified regarding the level and timing of disclosure made to certain credit and loan product customers and the remediation of these customers.”
The bank announced in December last year that it had paid $3.8 million to more than 10,000 customers to refund them some of the interest and fees they had been wrongly charged.
It says when it implemented changes under the CCCFA in 2015, some confirmation letters weren’t sent quickly enough and some documentation was missing information - such as total interest and total payments. Some new credit card and home loan accounts were set up with old documentation because the rules changed while the paperwork was being processed.
Chief executive Angie Mentis said then that no customers had been overcharged “but we didn’t get it 100 percent right.”
BNZ now says it voluntarily made the regulator aware of these issues “and we’ve been proactively engaging with them on these matters. However, as it’s an ongoing investigation, we’re not able to comment further at this time.”
Neither could BNZ say whether it has raised the matter with the Financial Markets Authority and Reserve Bank joint inquiry into banks because material provided “is subject to a confidentiality order."
But BNZ’s initial engagement with the Commerce Commission about CCCFA compliance took place before the FMA/RBNZ inquiry began last year, it says.
The Commerce Commission closed a similar investigation into Westpac in October after a settlement including agreed changes to certain consumer credit contracts.