ASIC Enforcement Wrap: September 2023 | ASIC shows continued appetite for civil actions amid new success in obtaining penalties

26 October 2023
  • Federal Court imposes large penalties on banks that overcharged customers, and failed to act quickly enough to find a solution and remediate customers, and that misrepresented to credit card account holders their level of available funds - NAB was penalised regarding periodic payment fees and ANZ regarding misrepresenting available funds on credit card accounts.
  • ASIC follows up on their recently completed review of superannuation trustee practices by suing AustralianSuper for their failure to identify and merge multiple superannuation accounts held by the same member.
  • ASIC beefs up enforcement against crypto products:

          - commencing a civil penalty proceeding against Bit Trade Pty Ltd for
             alleged breaches of the design and distribution obligations in relation
             to a crypto exchange related product; and

          - issuing infringement notices against Bobbob Pty Ltd for
             misrepresentation in relation to a crypto linked investment product.

  • Companies Auditors Disciplinary Board hands down two decisions in short succession in proceedings initiated by ASIC, sanctioning two company auditors, highlighting ASIC’s efforts to maintain high professional standards for audits.

September in Summary – Enforcement Actions and Outcomes

Civil Action

Civil Penalties

Over $18 million in penalties were ordered by the Federal Court in September across three proceedings.

  • The Federal Court ordered a $1.2 million penalty against ACBF Funeral Plans Pty Ltd for misrepresentation in the sale and promotion of funeral insurance. The Court found that ACBF represented that plan holders would receive a lump sum payment for a chosen benefit amount, when in fact they would be reimbursed for expenses only after proving that expenses were incurred.
  • The Federal Court ordered a $2.1 million penalty against NAB for wrongly overcharging customers periodic payment fees beyond its contractual entitlement. Between January 2017 and July 2018, there were 74,593 instances of overcharging totalling $139,845 in charges in relation to 2,888 personal and 513 business banking customers. NAB has paid approximately $9 million to remediate overcharged customers since August 2001. Justice Derrington opined that the $2.1 million penalty was woefully insufficient, but it was the maximum he could impose based on the legislation that was then in effect. The ASIC Act has since been updated in 2019, and the same conduct would now have a maximum penalty of at least $15.65 million.
  • The Federal Court ordered a $15 million penalty against ANZ for misleading customers as to funds available in their credit card accounts. In the relevant cases, it was found that ANZ was yet to clear deposits paid into the credit card account, but the “Available Funds” represented that deposit was already processed.  Some customers then obtained cash advances in reliance upon the “Available Funds” believing there were sufficient funds available for the advance. Instead, they were hit with fees and interests because there were actually insufficient Available Funds. ANZ admitted to the contraventions, and it submitted joint submissions with ASIC on liability and penalty.

Civil Proceedings Commenced

Four civil proceedings were commenced, three of them civil penalty proceedings:

  • Civil penalty proceedings against Westpac for allegedly failing to respond to customers’ hardship notices within the required timeframe of 21 days. Some customers are alleged to have been subject to debt collection activities while waiting for a response to their hardship notices.
  • Civil proceedings against Paypal for alleged unfair contract terms with small businesses. The contract term in question required PayPal business accountholders to notify PayPal of any errors or discrepancies in fees that Paypal charged them within 60 days, or else accept those fees as accurate. ASIC alleged the term is unfair because its effect is to permit PayPal to retain overcharged or wrongly charged fees if it wasn’t notified within 60 days. ASIC seeks declarations that the term is void, and also injunctions and corrective orders.
  • Civil penalty proceedings against the trustee of AustralianSuper alleging failures to address multiple member accounts. Under section 108A of the Superannuation Industry (Supervision) Act 1993 (Cth), a superannuation entity is required to have processes to identify members having multiple accounts, and to merge them when it is in the members’ best interest to do so. ASIC alleges that AustralianSuper was aware of the possible gaps in its policies and procedures in 2018 but did not take adequate steps to investigate and resolve the issue until late 2021 and early 2022.
  • ASIC commenced civil penalty proceedings against Bit Trade Pty Ltd for alleged failure to comply with the DDO for the margin trading product that it offers on its cryptocurrency exchange. ASIC alleges that Bit Trade has failed to make any target market determination at all. This prosecution sends a message to the crypto industry that its products will continue to be closely scrutinised by ASIC to ensure they comply with regulatory obligations.


  • The Federal Court found that Ferratum Australia charged fees prohibited by consumer credit protection laws and overcharged customers of small amount credit contracts. Prohibited fees charged by Ferratum include “Returned Mail Fees” and direct debit fees when using certain credit cards. Although Justice Kennett found no evidence that Ferratum intended to take unfair advantage of its customers, he found that failure “to implement a system that would charge those customers correctly fell short of what was ‘ethically sound’. Ferratum Australia was placed into liquidation in April 2023, and did not appear at trial. Final orders will be made in a further hearing.


  • GuiltyPleas/Convictions – One defendant pleaded guilty to five counts of falsification of company books.
  • Withdrawal of Charges - Peter Challis was originally charged with one count of failing to discharge his duties in good faith in the best interests of a corporation. The charge was withdrawn after a pre-trial ruling in the County Court which found that Mr Challis did not have such a relevant duty in the circumstances of the case.

Administrative Action

  • Interim Stop Orders – One interim stop order was issued due to deficiencies in the target market determination. Concerns include that the target market was defined too broadly, and that distribution conditions were not appropriate.
  • Financial Services Bannings – One individual was permanently banned from financial services due to a dishonesty conviction.
  • Director Disqualification – Three individuals were disqualified for their involvement in the failure of nine companies, owing a total of over $13 million to unsecured creditors, including over $10 million owing to the ATO and other statutory creditors.
  • Auditor Disciplinary Action – The Companies Auditors Disciplinary Board have sanctioned two company auditors, in separate matters, for reasons such as failure to meet minimum standards of the audit, failure to adequately perform the duties of an auditor, and failure to identify circumstances that could threaten independence of the auditor.
  • Infringement Notices – Five infringement notices were issued.  One was issued by the Market Disciplinary Panel to Interactive Brokers for their failure to identify and stop suspicious trading of an ASX listed security by one of their clients. The remaining four were issued by ASIC against Bobbob Pty Ltd for misrepresentations, amongst other things, that its crypto-asset linked investment product was approved or licensed by ASIC.
  • Court Enforceable Undertaking – One court enforceable undertaking was accepted by ASIC from Bobbob Pty Ltd.


If any of the above is relevant to you or you want to know more, please feel free to get in touch.

The contents of this article do not constitute legal advice and it is not intended to be a substitute for legal advice and should not be relied upon as such.  It is designed and intended as general information in summary form, current at the time of publication, for general informational purposes only.  You should seek legal advice or other professional advice in relation to any particular legal matters you or your organisation may have.In September ASIC Enforcement has continued where it left off in August with a continued focus on civil penalty and other civil action with many cases having an element of consumer protection.Key September Takeaways: