ME Bank, a unit of Bank of Queensland (BOQ.AX), appeared in court over criminal charges for allegedly making false representations to customers about interest rates and repayments, Australia‘s securities regulator said on Wednesday.
The digital bank had a court hearing on Tuesday and faces 62 charges brought by the Australian Securities and Investments Commission (ASIC) in May for notices it provided home loan customers between September 2016 and September 2018.
The regulator alleges the issues happened due to failures in ME Bank’s systems and processes.
ME Bank self-reported the issues to ASIC in October 2018 and paid A$105,000 to compensate affected customers, a Bank of Queensland spokesperson said.
“BOQ Group was aware of this matter during the due diligence,” the spokesperson said, adding that it was working with the prosecution on “a way forward”.
The next hearing will be on Nov. 3, ASIC said. Prior to being taken over by Bank of Queensland in July, ME Bank was owned by 26 industry pension funds.
($1 = 1.3661 Australian dollars)
Reporting by Riya Sharma and Nikhil Kurian Nainan in Bengaluru; Editing by Devika Syamnath and Shounak Dasgupta
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