Westpac Subsidiaries Ordered to Pay $10.5 Million Fine for Breaches of Best Interests Duty

The Australian Securities and Investment Commission (ASIC) today announced that the Federal Court has ordered Westpac Bank subsidiaries Westpac Securities Administration Limited (Westpac Securities) and BT Funds Management Limited (BT Funds) to pay a $10.5 million fine for failing to act in their clients' best interests.

More specifically, Westpac Securities and BT Funds have been ordered to pay a $7.5 million penalty and a $3 million penalty respectively.

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The penalty follows the High Court's unanimous decision on 3 February 2021 that Westpac Securities and BT Funds breached their best interests duty when they provided personal financial product advice in calls made to 14 customers, despite neither firm being licensed to provide personal advice.

ASIC Commissioner Danielle Press said, "Westpac was actively conducting a sales campaign aimed at rolling customers from their existing superannuation accounts into Westpac superannuation products. In doing this, Westpac failed to act in the best interests of their customers. "

An ASIC investigation found that Westpac Securities and BT Funds conducted two telephone campaigns which recommended that customers roll out of their other superannuation funds into a Westpac-related superannuation account.

​Earlier this month, Westpac it has completed the sale of its Vendor Finance business to Angle Finance​, a portfolio company of Cerberus Capital Management, L.P.