ANZ vs ASIC: Australia’s Hardest Corporate Penalty Yet

In September 2025, the Australian Securities and Investments Commission (ASIC) submitted a proposed A$240 million civil penalty to the Federal Court against Australia and New Zealand Banking Group Limited (ANZ). The penalty followed four separate ASIC proceedings covering institutional markets conduct and widespread retail banking failures.

Although legally distinct, ASIC treated the matters as part of a broader pattern. The regulator characterised the conduct as occurring across unrelated divisions of the bank between 2022 and 2024, involving government counterparties, wholesale markets and vulnerable retail customers.

The proposed penalty is among the largest ever sought by ASIC against a single financial institution and reflects heightened regulatory focus on non financial risk, systems failures and governance accountability.

background

One proceeding arose from ANZ’s role in an April 2023 Australian Government bond issuance conducted through the Australian Office of Financial Management. The issuance raised approximately A$14 billion through a syndicated process.

ASIC found that, during pricing windows, ANZ traded substantial volumes of 10 year Australian Government bond futures. The timing and volume of this trading placed downward pressure on bond prices at critical moments, exposing the Commonwealth to potential detriment.

Disclosure was central. ASIC alleged, and ANZ admitted, that the bank did not disclose remaining futures positions to the AOFM prior to pricing, preventing the government from adjusting issuance parameters. Subsequent explanations provided by ANZ were found misleading or deceptive.

Taken together, ANZ admitted that its conduct met the statutory definition of unconscionable conduct under the ASIC Act in its dealings with the Government.

Misreporting of bond turnover data

A related issue involved bond turnover reporting. Over nearly two years, ANZ submitted secondary market turnover data that was materially inflated. These figures were used to assess dealer performance and inform participation in future issuance panels.

ASIC found internal staff were aware of possible inaccuracies but continued to attest the data was correct. ANZ admitted providing false or misleading information and making false attestations to a Commonwealth entity, contravening provisions under the ASIC Act and general licensee obligations.

Retail banking failures

Separate proceedings addressed ANZ’s retail operations, affecting nearly 65,000 customers.

Between May 2022 and September 2024,488 customers submitted statutory hardship notices, many citing illness, bereavement or family violence.

ASIC found that ANZ failed to respond or properly assess many notices within required timeframes. In some cases, hardship review processes were incomplete or absent.

ASIC also identified systemic issues in deceased estate management. Fees were charged to thousands of deceased customers, and refunds or responses to family members were delayed.

Savings products were also affected. Tens of thousands of customers did not receive advertised or represented interest rates, including bonus rates, and systems for applying entitlements did not operate as described.

ANZ admitted the facts underlying these retail matters and accepted that the conduct breached obligations under the ASIC Act, consumer credit legislation and general licensee duties.

Legal Considerations

The proceedings involved multiple legal frameworks relevant to both institutional and retail conduct:

• Unconscionable conduct under the ASIC Act – applied to ANZ’s dealings with the Government during the bond issuance.

• Misleading or deceptive conduct and false statements – for turnover reporting and attestations to a Commonwealth entity.

• Breach of financial services licensee obligations – reflecting general compliance duties.

• Consumer credit and protection laws – covering hardship notices, management of deceased estates, and misrepresentation of savings interest entitlements.

  
  

These legal considerations formed the basis for the civil penalty proposed and the remediation measures required.

penalty and remediation framework

ASIC and ANZ jointly proposed a total civil penalty of A$240 million, subject to Federal Court approval. The allocation was A$125 million for institutional and markets matters, including an A$80 million component for unconscionable conduct in the bond issuance, and A$115 million for retail matters covering hardship failures, deceased estates and interest misrepresentation.

ANZ agreed to undertake remediation, including refunding unpaid interest, issuing back payments, reinstating entitlements, processing deceased estate refunds, improving hardship management systems, strengthening internal reporting controls and implementing verification processes for turnover data.

Public statements from ANZ’s Chair and CEO confirmed acceptance of ASIC’s findings and a commitment to reform.

Professional significance

This proceeding consolidates institutional misconduct and widespread retail failures into a single regulatory outcome. It demonstrates ASIC’s willingness to pursue unconscionability findings in institutional markets, including dealings with government, rather than limiting enforcement to retail consumer contexts.

The matter reinforces that reporting accuracy, disclosure and attestation obligations are central to market integrity. Errors framed as systems issues or operational oversights are treated as serious compliance failures.

For major financial institutions, the proposed penalty sets a benchmark for the consequences of sustained non financial risk across multiple business lines. It signals that failures affecting both sovereign counterparties and vulnerable customers will be assessed collectively when determining regulatory outcomes.

Authored by Campbell Dore

Publisher

The Brief

campbell@thebrieflaw.com.au