The Australian Securities Investments Commission has reprimanded the Commonwealth Bank for misleading customers about the effects of incoming laws regarding consent for credit limit increases.
The new laws – which come into play in July – will ban credit providers from making unsolicited credit limit increase offers to customers.
CommBank contacted customers in December about the new laws to get customers’ consent to receive credit-card limit increase invitations. About 96,000 customers did so.
But the securities watchdog says the emails were misleading because they suggested that if customers did not consent they wouldn’t be able to receive future offers.
They also considered the emails misleading because they created the impression that customers needed to act urgently and suggested that customers not consenting would miss opportunities for extra funds.
The bank and ASIC yesterday confirmed a court enforceable undertaking, with CommBank agreeing to disregard the consents received and contact each consenting customer with revised information.
ASIC says the new laws allow customers to request a credit limit increase from their financial institution at any time and withdraw consent at any time.
ASIC commissioner Peter Kell said the law was designed to “assist consumers to actively choose how to manage their credit limit, rather than being prompted to increase their limit by unsolicited letters from their bank or credit provider.”