Rania Spooner April 18, 2012 - 11:27AM
Bankwest has become the latest bank pulled into the largest class action against late payment fees in Australian history, worth $223 million, after an action on behalf of its clients was filed today.
Maurice Blackburn Lawyers launched proceedings against Bankwest in the Federal Court in Melbourne claiming $10 million worth of late credit card repayment fees and dishonour fees charged by Bankwest in the past six years should be given back to customers.
It is the latest in a string of actions launched by the same group against Australian banks, which started with a claim against the ANZ in 2010.
In recent months the CBA, Westpac, NAB, Citibank, St George and BankSA have also been drawn in, bringing the total claimant pool to more than 170,000 people and the estimated claim size to $223 million.
The lawyers are aiming to get $1000 to $1500 back for each of the 6600 Bankwest claimants.
About half of the 6600 Bankwest customers who have now signed onto the action were from Western Australia.
Last year a judge made a ruling in favour of Maurice Blackburn's claimants in relation to the pilot ANZ case, finding late fee payments could be considered penalties.
The ruling was only an early step in the action which is expected to be drawn out into next year, but it would mean a bank should only claim back what the late payment has cost them.
Maurice Blackburn senior associate Paul Gillett said the "height of this price gauging" was in 2009 when banks charged Australian households $1.3 billion in exception fees.
Over the past six years the banks have charged up to $6 billion in exception fees, according to Maurice Blackburn's estimates.
"The fees that the bank was charging do not reflect the actual cost to the bank of for example being late on your credit card," Mr Gillett said.
Litigation funder IMF' subsidiary Financial Redress managing director James Middleweek said Bankwest had some of the highest exception fees in the market.
Despite some of major banks reducing their exception fees following the start of the class action, Bankwest, a CBA subsidiary, has kept its fees high, Mr Middleweek said.
"I was quite surprised and shocked that despite all the pressure since we launched the case originally and all the public outcry to reduce fees that in fact Bankwest have barely done that at all," he said.
"Bankwest is one of the worst offenders."
Mr Middleweek said he believed Bankwest was taking advantage of its loyal customers in WA.
A Bankwest spokeswoman said the company would defend the action.
"As this is an ongoing legal matter and also the subject of existing legal proceedings against the other major banks it would be inappropriate to comment further," she said in a statement.