The Australian Securities and Investments Commission has started Federal Court proceedings against the bank for allegedly misleading customers over their account balances on credit cards.

ASIC said over a two-year period up until November 2018 about 165,000 customers were allegedly charged cash advance fees and interest for withdrawing or transferring funds from their credit cards based on incorrect account balances.

ASIC said about $10 million was remediated, but also said the problem continued and it was now seeking orders for the people affected since 2018.

It claimed that between 2016 to 2021, ANZ made false or misleading representations about account balances and whether those funds would be available for withdrawal without fees or interest being charged.

ASIC alleged the bank had also failed to ensure the credit activities authorised by its licence were engaged in efficiently, honestly and fairly.

“ASIC is seeking orders from the court that customers who were wrongly charged since 2018 also be remediated,” ASIC said.

It was also seeking declarations and pecuniary penalties from the court as well as orders that require ANZ change its systems when a customer makes a payment to a credit card account.

ASIC deputy chair Sarah Court said the organisation was concerned that over a long period of time ANZ overstated the available funds and balances on credit card accounts and nonetheless charged fees and interest to customer who relied on this information when making withdrawals.

“In some cases, single customers were charged thousands of dollars in fees while the average cash advance fees and interest charged per affected account was $47.

“This alleged misconduct is the result of system errors with ANZ and a lack of effort to comprehensively fix these issues.

“We say that ANZ has been aware of unlawfully charging since at least 2018 and the problem is still occurring today.”