Financial institutions which have special promotions which involve fee waivers or fee discounts of their standard account fees need to ensure they have systems in place to ensure those waivers or discounts are actually delivered.

ASIC has announced that Westpac Banking Corporation (Westpac) has refunded approximately $9.2 million to 161,414 customers after it failed to waive fees on Westpac and St. George branded savings and transaction accounts over a six year period.

For customers aged under 21 years, Westpac previously relied on staff to manually apply a monthly service fee waiver for customers with a Westpac Choice transaction account and a withdrawal fee waiver for customers with a Westpac Reward Saver account.

However, between May 2007 and April 2013, 133,045 Westpac Choice and Westpac Reward Saver accounts were opened for some eligible customers without the relevant fee waivers being applied.

Westpac also discovered that there were 28,369 customers under the age of 18 who were eligible for a St. George Complete Freedom Student transaction account (which has no monthly service fee), but instead held a standard St.George transaction account which charged a monthly fee.

Westpac self-reported these breaches to ASIC.