Australia’s corporate regulator has started legal proceedings against HSBC’s local affiliate. The Australian Securities and Investments Commission (ASIC) claims the bank did not properly address about 950 reports from customers who lost nearly a million dollars or more.
ASIC alleges that HSBC took an average of 145 days to investigate issues related to unauthorized payments and transactions.
ASIC reported that from January 2020 to August 2024, HSBC Australia received reports of transactions that led to customer losses of approximately A$23 million (around $14.61 million). Almost A$16 million of these losses occurred between October 2023 and March 2024.
The regulatory body claims that HSBC Australia did not have sufficient controls to prevent and detect unauthorized payments. Additionally, the bank failed to promptly investigate customer reports of unauthorized transactions and did not restore banking services in a timely manner.
Australian authorities and banks are intensifying their efforts to reduce scams in the banking industry.
In the year leading up to September 2024, there were approximately 265,000 reports of banking-related scams in Australia. During this period, victims reported losses totaling about A$306.5 million, according to data from the Australian Banking Association’s website.
ASIC Deputy Chair Sarah Court asserted that HSBC Australia’s failures were extensive and systemic. She added that the bank did not protect its customers.
ASIC is pursuing declarations of violations, financial penalties, publicity orders, and costs, according to its statement.
An HSBC spokesperson acknowledged ASIC’s claims and stated, “We are considering the matters raised and will continue to co-operate and work constructively with ASIC.”
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