An Australian law firm and Australian litigation funders announced on Monday a plan to file a $1 billion lawsuit against New Zealand’s banks for the “excessive” default fees charged by the institutions.
Andrew Hooker, an attorney backed by Slater & Gordon and Litigation Lending Services, said that while all New Zealand banks could be named in the suit, ANZ, ASB, BNZ, Westpac and Kiwibank were the primary targets, The New Zealand Herald reports.
Another similar case in Australia has targeted 12 banks, including four of the institutions named by Hooker, and has been ongoing since May 2010.
Hooker noted a milestone ruling against ANZ last November, when the High Court of Australia ruled that excessive and unfair bank fees could be considered as penalties. The case will, however, be reviewed by an Australian federal court, according to The New Zealand Herald.
The lawsuit is targeting insufficient funds fees charged to satisfy a direct debit payment, insufficient funds fees for bounced checks, unauthorized overdraft fees and late payment fees for credit cards.
Kirk Hope, the CEO of the New Zealand Bankers Association, said that while financial institutions would take the action seriously, the legal charges do not account for differences between New Zealand and Australian law.
“There isn’t such a thing as a class action in New Zealand,” Hope said, The New Zealand Herald reports.
Additionally, Hope said that three out of the four fees named in the lawsuit are already regulated by the Commerce Commission, saying that the commission has taken action against banks in the past. He also said that people in New Zealand were happy with their banks.
“Last year, Consumer New Zealand did a survey and found bank satisfaction levels at 92 percent,” Hope said, according to The New Zealand Herald. “If there are issues around fees, I would have thought they would come up through that process.”