ANZ New Zealand is awaiting a High Court decision on a financial penalty after admitting to misleading representations in supplying credit card repayment insurance.

A court hearing to determine the penalty was held today in Auckland, with the Financial Markets Authority (FMA) calling for a payment of $NZ280,000 ($261,200) and declarations of contravention.

The regulator says it’s awaiting the decision and will comment after it’s issued.

ANZ’s admissions were part of a resolution reached with the FMA after it filed proceedings last June. The action was the first to be brought by the regulator under fair-dealing provisions in the Financial Markets Conduct Act and alleged the bank charged certain customers for policies that offered no cover or benefit.

The FMA last year said ANZ issued duplicate credit card repayment insurance to some customers, which provided no additional benefits or cover and charged premiums on those policies, from April 2014 to November 2019.

The bank also issued and failed to cancel policies for ineligible customers, charging premiums on those policies from April 2014 to May 2018.

The FMA said the issues went back to at least 2001, but the Financial Markets Conduct Act 2013 did not come into effect until the following year.

“While ANZ has embarked on their own remediation program and ultimately self-reported this matter, the case points to a failure of internal systems and controls resulting in customer harm over a significant period of time,” FMA General Counsel Nick Kynoch said last year.

“Self-reporting is expected and is taken into account by the FMA when determining the appropriate regulatory outcome. In this instance we felt it appropriate to put the matter before the courts.”

An ANZ New Zealand spokesman says the business stopped selling credit card repayment insurance in 2019.

“ANZ is awaiting the decision of the court and will comment after it is issued,” he told insuranceNEWS.com.au today.