ASIC sues Commonwealth Bank over millions in undisclosed business fees
ASIC has launched civil penalty proceedings against Commonwealth Bank alleging its CommBiz platform failed to disclose fees for internal account movements, affecting tens of thousands of business customers.
The Australian Securities and Investments Commission has launched civil penalty proceedings against Commonwealth Bank over undisclosed business transaction charges.
ASIC Targets Commonwealth Bank Over CommBiz Platform Fee Disclosures
The corporate regulator has initiated legal action against Commonwealth Bank of Australia, accusing the nation's largest bank of misleading business customers through its online banking platform, CommBiz. According to the Australian Securities and Investments Commission, the platform's terms and conditions failed to properly disclose all fees applied to direct debit and direct credit payments. While business users were informed they would incur charges for transactions involving third-party accounts, regulators state that an additional, undisclosed fee was levied for the matching movement of money into or out of the customer's own business accounts.
These secondary charges, identified by regulators as contra leg fees, meant that complex transactions generated multiple unexpected costs. In one operational example highlighted by the corporate watchdog, a small enterprise paying fortnightly wages to 10 employees across two separate CommBiz accounts encountered 12 distinct charges. This total comprised 10 standard payments alongside two hidden withdrawals applied to the organisation's internal accounts.
ASIC Commissioner Alan Kirkland criticised the institution for failing to maintain basic operational standards.
Mr Kirkland added that small business operators face enough daily pressures without needing to audit individual transaction lines for unexpected bank levies."We allege Commonwealth Bank broke a basic promise to its business customers."
Alan Kirkland, Commissioner, via abc.net.au
| Detail | Information |
|---|---|
| Affected Accounts | CommBiz online banking platform |
| Target Customers | Tens of thousands of business customers, predominantly small businesses |
| Regulator Action | Civil penalty proceedings commenced by ASIC |
| Alleged Overcharging Period | November 2020 to May 31, 2025 (with underlying terms active since 2006) |
| Estimated Affected Customers | Approximately 42,000 customers |
| Estimated Overcharged Amount | Approximately $8.5 million |
| Remediation Disbursed | More than $26.4 million distributed to approximately 93,000 customers |
Decades-Old Terms and Missed Internal Audits
The legal filing reveals that the allegedly misleading contract terms date back to the initial launch of the CommBiz platform in 2006, spanning a timeframe of roughly 19 years. Regulatory investigations indicate that the bank received direct complaints from customers regarding the fee structure starting from at least 2015. Furthermore, an internal audit conducted within the institution identified overcharging related to direct debit transactions, prompting a formal requirement for corrective action.
Despite these internal discoveries and external warnings, governance failures within the bank reportedly prevented staff from identifying and correcting the misleading disclosures. Regulators claim these failures demonstrate that the institution neglected its legal obligation to operate efficiently, honestly, and fairly. The current legal challenge forms part of an enduring enforcement priority targeting systemic breakdowns within large financial institutions, compounded by a specific 2026 regulatory focus on deceptive pricing practices during tight economic conditions.
Remediation Efforts and Bank Responses
Commonwealth Bank adjusted its operations prior to the formal launch of court proceedings. The institution temporarily halted the collection of the disputed fees in June 2025, subsequently revising the CommBiz terms and conditions in August 2025. The bank has waived the contra leg fees for processing direct debits and direct credits.
A comprehensive remediation program has also been executed by the bank, addressing accounts active from December 1, 2006, onward. This remediation initiative has delivered over $26.4 million in compensation payments to approximately 93,000 CommBiz users, a group that includes roughly 40,000 small businesses.
In response to the civil filing, the corporate regulator is pursuing formal court declarations, pecuniary penalties, adverse publicity orders, ancillary orders, and legal costs against the banking institution. The legal action coincides with broader regulatory scrutiny across the Australian banking sector, following recent admissions by Macquarie Bank regarding promotional savings rate failures and prior industry-wide reviews of mortgage offset account errors.
As the legal dispute proceeds, the court has not yet scheduled a date for an initial case management hearing, leaving the timeline for further judicial proceedings unconfirmed.
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