The Federal Court has ordered Australia and New Zealand Banking Group Limited (ANZ) pay $250 million in penalties for widespread misconduct and systemic risk failures affecting the Australian Government, taxpayers and at least 65,000 retail bank customers.
These are the largest combined penalties ASIC has ever secured against a single entity.
His Honour Justice Jonathan Beach increased the penalty for ANZ's inaccurate reporting of secondary bond market turnover data by $10 million, bringing the penalty in relation to that misconduct to $50 million.
The outcome is in relation to four separate court proceedings spanning misconduct across ANZ's Institutional and Retail divisions, announced in September 2025 (25-201MR).
His Honour Justice Jonathan Beach today ordered ANZ pay:
- $135 million in combined penalties for institutional and markets misconduct relating to the management of a $14 billion government bond deal and inaccurate reporting of secondary bond market turnover data to the Australian Government. This includes a record $80 million penalty for unconscionable conduct,
- $40 million for failing to respond to hundreds of customer hardship notices, in some cases for more than two years, and failing to have proper hardship processes in place,
- $40 million for making false and misleading statements about savings interest rates, and failing to pay the promised interest rate to tens of thousands of customers, and
- $35 million for failing to refund fees charged to thousands of dead customers and not responding to loved ones trying to deal with deceased estates inside the required timeframe.
ASIC Chair Joe Longo said, 'ANZ is a critical part of Australia's banking system and, frankly, they 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.
'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 mislead 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 across ANZ's retail bank, which extended to fundamental banking basics like paying the correct interest rate on savings accounts.
'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.
'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,' the Deputy Chair said.
In relation to misconduct relating to the management of the $14 billion government bond deal, His Honour Justice Beach said, 'ANZ did not act conscionably, did not act transparently, nor did it trade in the way in which it said it would but, to the contrary, it conducted its hedging in a manner which caused undue pricing pressure on the reference price product at the time of pricing.
'ANZ's behaviour was particularly serious when coupled with ANZ's inaccurate and incomplete statements to the AOFM in relation to the manner of its trading and behaviour as a duration manager, when post-completion of the issuance the AOFM expressed concern about the price at which the bond issuance had priced. ANZ's post-completion conduct reveals a lack of candour and frankness about its trading.'
In deciding to increase the penalty for the misreporting conduct by $10 million to $50 million in total, the Court found ANZ's conduct was both 'inexcusable' and had 'no redeeming feature whatsoever' and that a 'very substantial penalty needs to be imposed to achieve both specific deterrence and general deterrence.'
'Accurate information is the life-blood of the AOFM in its assessment of the activities in the relevant markets and the position of the participants.'
In his judgment on the retail matters, His Honour Justice Beach reflected on the 'serious and unacceptable nature of the contraventions' and that penalties were 'not to be regarded as a cost of doing business.'
The $35 million penalty for ANZ's misconduct relating to deceased estates 'puts a price on the contraventions that is appropriate to deter both repetition by ANZ and contravention by other licensees.'
His Honour noted ANZ had 'engaged constructively with ASIC in advance of this proceeding being commenced, including by making admissions in relation to its conduct at the earliest available opportunity, acknowledging liability in respect of the admitted contraventions.'
ANZ admitted to the misconduct in September 2025, and together with ASIC, asked the Federal Court to impose penalties of $240 million (25-201MR).
Each matter was separately considered and heard by Justice Beach on 2-3 December 2025 and judgment was delivered on 19 December 2025.
Downloads
Judgments
Initiating proceedings documents
- Bond deal and misreporting of bond trading data: Originating process and Statement of Agreed Facts
- Financial hardship: Originating application and Statement of Agreed Facts
- Bonus interest: Originating process and Statement of Agreed Facts
- Deceased estates: Originating process and Statement of Agreed Facts
Background
The four matters filed against ANZ concern:
Unconscionable conduct when managing a $14 billion government bond deal and inaccurate reporting of secondary market bond turnover
On 19 April 2023, ANZ was assisting the Government's sovereign debt management agency, the Australian Office of Financial Management (AOFM), to help deliver a $14 billion bond issuance.
Instead of trading gradually throughout the day to limit market impact, ANZ sold a significant volume of 10-year Australian bond futures around the time of pricing which placed undue downward price pressure on the bond price. ANZ knew its trading could expose its client to significant risk of harm, but did not disclose to its client that ANZ still had significant volumes to sell before pricing nor provide its client an opportunity to consult with ANZ about delaying pricing. This denied the Government an opportunity to protect itself and the public interest. The Government was relying on ANZ's expertise and professionalism. When the Government later asked what happened, ANZ's reports were misleading or deceptive.
The bond deal was raising money to finance government spending for the benefit of all Australians. This is one way the Australian Government funds critical government services, such as health, social welfare, education, infrastructure and defence.
ANZ also misled the Government about its trading turnover for nearly two years. This data, among other factors, helps the Government select dealers for bond issuances. ANZ's inflated figures made it appear more active than it was and occurred despite internal concerns about the accuracy of the data and awareness that the figures could influence future appointments on bond issuances.
ANZ admitted to acting unconscionably and misleading the Government. It also admitted to failing to meet its obligations as an Australian financial services licensee. It agreed to seek a combined penalty of $125 million.
Financial hardship
ANZ failed to respond to 488 customers who submitted financial hardship notices to the bank between May 2022 and September 2024. In some cases, ANZ took more than two years to respond to customers. Personal circumstances reported by customers when providing hardship notices to the bank included unemployment, serious medical issues, bereavement and family violence. In some cases, ANZ took action to recover debts from customers even when they had not responded to the customers' hardship notices, including issuing default and demand notices, and referring customers to external debt collection agencies.
ASIC first notified ANZ of issues with its financial hardship processes in June 2023, however, steps taken by ANZ to fix the issues did not work consistently, resulting in some further failures by ANZ up to September 2024. ANZ has completed a remediation program for affected customers, which has included customer payments totalling $92,687 and corrections to customer credit reports.
Bonus interest
Between July 2013 and January 2024, ANZ promoted offers on its website to pay introductory bonus interest to customers who opened certain new accounts. However, due to process deficiencies in ANZ's systems, the bonus interest was not always applied. ANZ remediated 194,487 accounts (7.26% of these accounts opened during the period) as a result of the issue and adopted higher interest rates when in doubt, and remediated secondary impacts and the time value of money. Separately, between August 2024 and March 2025, ANZ promoted on its website base variable and bonus fixed introductory interest rates for certain accounts which were inaccurate. The issue impacted 56,703 customers (46.4% of accounts opened during this period), resulting in ANZ failing to pay the correct amount of interest promised to 26,917 customers, with around $480,000 in interest not paid out. ANZ have remediated these customers.
Deceased estates
Between July 2019 and June 2023, ANZ failed to refund fees charged to thousands of deceased customers. This is because its systems and processes could not identify which fees should be waived and/or refunded and whether any fees charged after a customer's death had been waived or refunded. ANZ did not respond to representatives of deceased estates in the required timeframe after notification of the customer's death. ANZ has been unable to identify the total number of affected customers so the full extent of the impact is still unknown. ANZ's failures are likely to have compounded the difficulties faced by loved ones dealing with the death of a family member or relative, as well as frustrating the probate process.
ANZ first identified the systems, controls and processes issue in 2022, and took over a year to resolve it. In response in July 2024, ANZ was sanctioned for breaches of the Banking Code of Practice by the Banking Code Compliance Committee. Over 18,900 customer accounts were remediated $3.8m by ANZ for fees it did not intend to charge and additional costs arising from delays, with over 9,000 people also contacted to apologise for delays they experienced.
Prior misconduct by ANZ across seven matters of concern includes:
- In 2023, ANZ was ordered to pay a $900,000 penalty for breaching continuous disclosure laws when undertaking a $2.5 billion institutional share placement in 2015 (23-332MR) in circumstances where the maximum penalty applicable at the time was $1 million.
- In 2023, ANZ was ordered to pay a $10 million penalty for contravening the Credit Act by accepting information and documents from unlicensed third parties in its home loan introducer program (23-059MR).
- In 2023, ANZ was ordered to pay a $15 million penalty for breaching the Credit Act and the ASIC Act for misleading customers about their available funds for certain credit card accounts, resulting in fees and interest charges (23-260MR).
- In 2022, ANZ was ordered to pay a $25 million penalty for 155,868 contraventions of the ASIC Act, Corporations Act and Credit Act for failing to provide promised benefits to customers with offset transaction accounts or under a 'Breakfree' package over 20 years (22-290MR).
- In 2020, ANZ was ordered to pay a $10 million penalty for breaching the Corporations Act and the ASIC Act in relation to 327,898 instances of unconscionable conduct over periodic payment fees charged to customers until September 2015 (20-232MR)
- In 2018, ANZ was ordered to pay a $5 million penalty for breaching responsible lending provisions in the Credit Act for failing to verify customer income in its former Esanda car finance business (18-057MR).
- In 2017, ANZ was ordered to pay a $10 million penalty for contraventions of the Corporations Act and the ASIC Act for attempting to manipulate the bank bill swap reference rate (BBSW) on ten occasions over an 18-month period (17-393MR).
