Slater and Gordon has filed a class action against Commonwealth Bank, alleging the Big Four bank sold its customers junk credit card and personal loan insurance.
The class action, filed in the Federal Court, is the fourth in the #GetYourInsuranceBack campaign.
The Commonwealth Bank has admitted that these products were worthless, even though they were sold to hundreds of thousands of their customers.
During the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, it was revealed the bank’s CEO Matt Comyn, had pushed for the bank to stop selling the junk insurance in 2015. Mr Comyn was, however, told by the then CEO to “temper [his] sense of justice”, and the products continued to be sold until March 2018.
Existing policies, however, have simply been rolled over and many customers are continuing to be charged thousands of dollars in fees for the worthless products to this day.
Slater and Gordon Practice Group Leader Andrew Paull said the class action gave a voice to those who were vulnerable and duped into buying worthless insurance. It would allow those customers to hold the bank to account for its wrongdoing.
Mr Paull said he hoped the class action would help the customers get their money back, while keeping corporate giants honest.
“A 2018 review of the Commonwealth Bank’s sale of consumer credit insurance products revealed that more than 200,000 people who were unemployed or not working full time had been sold this type of policy, meaning it was very unlikely they would have been able to claim against the insurance,” Mr Paull said.
“This is reprehensible behaviour by the bank, which has chosen to compensate only a negligible portion of its customers, despite their admission that they knew the insurance was worthless.
“This move to return only a small portion of its customers premiums seems to have been a tokenistic effort to protect the bank’s brand, rather than a genuine attempt to make good its past wrongdoing.
“Slater and Gordon is still being contacted by large numbers of Commonwealth Bank customers who should never have been sold the products, yet have never been remediated.”
Mr Paull called on the Commonwealth Bank to do the right thing and properly address the claims brought in this class action by ensuring that all aggrieved customers are compensated.
Slater and Gordon recently settled a class action against NAB for $49.5 million and is preparing to start distributing compensation in the coming month. The firm filed similar class actions against ANZ and Westpac earlier this year.
Consumers who purchased either Credit Card Plus, or Personal Loan Insurance and have paid a premium since 2010 may be included in the class action.
The class action is being run no-win, no-fee.