Banking regulator ASIC has announced it is suing Westpac for failing to respond in time to requests for assistance from customers struggling with mortgage repayments.
In a statement on Tuesday, ASIC alleged hundreds of customers were left in the dark due to a “deficiency” with Westpac’s process for tracking those experiencing hardship.
The lawsuit will come as a blow to CEO Peter King, who has repeatedly urged customers to notify the bank immediately if they are experiencing mortgage stress due to Australia’s rapid interest rate hikes.
According to the regulator, the bank failed to deliver 448 online hardship notices to its “Customer Assist” team for processing and at least 229 customers then failed to receive a response within the legally mandated 21 day time period.
Every one of those customers had informed Westpac they were experiencing financial difficulties, with many presenting valid reasons including inability to work, the impacts of serious medical conditions or responsibilities as a care provider.
ASIC also alleges some of those customers were subject to debt collection actions from the bank while they were still awaiting a response.
