Australia’s corporate regulator has launched legal proceedings against the local branch of the global bank HSBCclaiming it failed to properly respond to about 950 reports of customers losing nearly $1 million or more.
Australian Securities and Investments Commission (Special Integrated Circuit) claims HSBC spent an average of 145 days investigating issues related to unauthorized payments and transactions.
ASIC added that HSBC Australia received reports of these transactions between January 2020 and August 2024, resulting in customer losses of approximately A$23 million (US$14.61 million).
Nearly A$16 million of the losses occurred between October 2023 and March 2024, the report said.
Regulator claims HSBC Australia lacked adequate controls to prevent and detect unauthorized payments, failed to investigate customer reports Unauthorized transaction Banking services were not restored in time.
The legal action comes as Australian authorities and banks redouble their efforts to reduce the number of scams taking place in the country’s banking sector.
According to data on the Australian Banking Association website, approximately 265,000 bank-related fraud cases were reported in Australia in the 12 months to September 2024, with approximately A$306.5 million lost during the period.
“We allege that HSBC Australia’s failings were widespread and systemic, and the bank failed to protect its customers,” ASIC deputy chair Sarah Court said.
In a statement, ASIC said it was seeking a declaration of non-compliance, fines, adverse publicity orders and costs.
Acknowledging ASIC’s claims, an HSBC spokesman said: “We are considering the issues raised and will continue to work constructively with ASIC.”
(USD 1 = AUD 1.5738)
