The Federal Court has imposed an additional $10 million penalty on ANZ, bringing the total fine to a staggering $250 million. This marks a new record for penalties related to longstanding “unconscionable conduct” by the bank.

The Australian Securities and Investments Commission (ASIC) highlighted that ANZ’s extensive misconduct and systemic shortcomings had significant repercussions, impacting not only the Australian government and taxpayers but also more than 65,000 retail customers.

ASIC’s investigation revealed that ANZ mishandled a $14 billion bond transaction for the federal government, failed to reimburse fees charged to thousands of deceased customers, and neglected numerous customer hardship notifications.

The regulatory body also discovered that the bank issued false and misleading statements regarding savings interest rates.

In light of these findings, the Federal Court decided that ANZ’s penalties should be increased, resulting in a total fine of $250 million for the major financial institution.

ASIC chair Joe Longo said ANZ “is a critical part of Australia’s banking system” that “must do better”.

“The size of the penalties ordered today underscores the seriousness of ANZ’s misconduct and its far-reaching consequences for the government, taxpayers and tens of thousands of customers,” Longo said.

“ANZ must overhaul its non-financial risk management and put the interests of clients, customers and the public first.

“In the bond trading and misreporting matter, ANZ exposed the Australian government to a significant risk of harm, denied the government an opportunity to protect itself and the public interest, and misled the government for nearly two years by overstating bond trading volumes by billions of dollars.

“ASIC estimates ANZ’s trading misconduct cost up to $26 million, reducing funds that could have supported essential public services.”

ASIC deputy chair Sarah Court said tens of thousands of customers suffered from systemic failures.

“ANZ will also pay for misconduct that made an already difficult time far harder for hundreds of its customers who were experiencing hardship or dealing with the loss of a loved one,” Court said.

“This outcome sends a clear message to ANZ that it needs to do better by its customers and to all banks that the cost of breaking the law is not an acceptable cost of doing business.”

In a statement, ANZ said it is “focused on significantly improving its management of non-financial risks across the bank, with a dedicated program of work underway as part of its root cause remediation plan”.

“In addition, ANZ has established an ASIC matters resolution program within Australia retail to meet commitments to ASIC to deliver improvements across a number of areas in its retail division.”