(Reuters) -The Australian Securities and Investments Commission (ASIC) on Friday said it commenced legal proceedings against Australia and New Zealand Banking Group for home lone referrals under its 'introducer program'.
The regulator added https://asic.gov.au/about-asic/news-centre/find-a-media-release/2021-releases/21-318mr-asic-sues-anz-over-introducer-program-home-loan-referrals that between June 2016 and March 2018, ANZ breached consumer protection credit laws by accepting customer information and documents from introducers and other unlicensed individuals, when this was not allowed.
The Introducer Program is a reward-based program through which businesses and community organisations refer customers and members with home loan needs to ANZ.
ASIC was concerned that some loans may have been granted by ANZ based on false information, said Deputy Chair Sarah Court, adding that some consumers may have entered into home loans that were beyond their ability to pay.
From 2015 to June 2020, more than 50,000 loans were referred to ANZ through the introducer program, resulting in lending of more than A$18.5 billion, the statement added.
ANZ said in a separate statement that it has co-operated with ASIC during its investigation and has also established a customer remediation program, while "continuously improving" its home loan processes and controls.
Scrutiny of Australian lenders and financial institutions has ramped up significantly since a Royal Commission inquiry in 2018 found widespread shortcomings in the sector, forcing companies and regulators to take swift action.
Last month, the country's largest lender Commonwealth Bank of Australia (OTC:CMWAY) had pleaded guilty to 30 criminal charges for mis-selling consumer credit insurance between 2011 and 2015.