Kiwis pay higher bank default fees than Australians – lawyer
An Auckland lawyer threatening class action against bank default fees says his comparison shows New Zealand customers are sometimes paying higher fees than Australians.
But while Andrew Hooker's comparison shows the Australian banks – Commonwealth Bank (ASB’s owner), NAB (BNZ’s owner), ANZ and Westpac – charge more for some default fees, it also shows the banks in New Zealand charge more for unarranged overdraft fees.
Mr Hooker has teamed up with Australian law firm Slater & Gordon and funder Litigation Lending Services, which will take a 25% success fee, in a bid to sue banks for imposing unreasonable default charges.
Mr Hooker's figures, which he says he has pulled from individual bank fee schedules, show banks in New Zealand “have decided to take advantage of their Kiwi customers”.
But the comparison shows a mixture of fee structures.
The comparisons, in New Zealand dollars, show three of New Zealand’s four major banks – ASB, BNZ and Westpac New Zealand – charge customers between $10 and $15 in unarranged overdraft fees, while their Australian customers are charged nothing.
Mr Hooker says only ANZ in New Zealand charges less than its parent at $15 a month, compared with ANZ Australia’s $7.50 a day up to $75 a month.
He says when it comes to charging for late credit card repayments,
Westpac NZ charges $15 for credit card overdraft and late repayments, and a $19 dishonour fee and automatic payment failed fee. Its parent bank in Australia charges up to $11.25 for each of those actions.
Mr Hooker says the more expensive fees in some categories show how important the proposed legal action will be for New Zealand.
He claims the banks have charged up to $1 billion in excessive default fees over a number of years.
If there is a favourable judgment in court, Litigation Lending Services will take its 25% success fee and the balance will be determined by the court.
“If we get 20,000 people signing up to take part in this action, it effectively means there will be 20,000 separate judgments,” Mr Hooker told NBR ONLINE.
Slater & Gordon will calculate individual losses and that will be the amount each participant will be reimbursed, should the court action be successful.
Papers are expected to be filed with the High Court within the next month.