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Australia's ANZ Bank wins appeal on landmark unfair fees class action
[MELBOURNE] Australia and New Zealand Banking Group on Wednesday won an appeal against a court ruling that some of its credit card fees were unfair, after thousands of disgruntled customers launched Australia's biggest ever class action.
The ruling is a blow to the hopes of almost 200,000 customers involved in class actions against Australia's largest banks to receive millions of dollars in compensation for fees and charges they claim are unlawful.
The ANZ case is the first of a series of class actions brought by law firm Maurice Blackburn against Australian lenders seeking repayment of allegedly excessive and unfair fees.
Maurice Blackburn subsequently issued closed class proceedings against Citibank, Commonwealth Bank of Australia, National Australia Bank, Westpac and some regional Australian lenders.
More than 185,000 Australians signed up online to join the lawsuits challenging charges including honour and dishonour fees on bank accounts, over limit fees and late payment fees on credit cards.
The banking sector faced up to A$240 million (S$250 million) in compensation payouts if the fees were found to be unlawful, according to the law firm.
ANZ appealed a Federal Court ruling last year that it was"extravagant, exorbitant and unconscionable" to charge its customers fees for late payments on credit cards.
The Federal Court of Australia on Wednesday also stood by a ruling that ANZ's honour, dishonour and over-limit fees were legal.
Last November, NAB said it was moving to settle the class action, opening the door to millions of dollars in compensation for disgruntled customers.
Betham IMF Ltd, the company that has been funding the ANZ litigation, said it was likely that an appeal would be launched in the High Court. IMF Betham said it would also write off about A$4 million and create a provision for adverse costs of around A$1.5 million.
Shares in IMF Betham fell 6 per cent after the ruling while ANZ shares were down 0.4 per cent in a firmer overall market.