Australian regulator sues Commonwealth over A$8.5 million in undisclosed fees
Key Facts
The Australian Securities and Investments Commission has launched civil penalty proceedings against Commonwealth Bank of Australia, alleging it charged about 42,000 business customers using its CommBiz business banking platform fees they had not been told about, totaling about A$8.5 million. The regulator said affected customers, many of them small businesses, were charged between November 2020 and 31 May 2025. The case concerns fees on direct debit and direct credit transactions, not a general allegation that the bank exceeded permitted fee caps. ASIC Commissioner Alan Kirkland said: "We allege that CBA breached a fundamental promise it made to its business customers." ASIC added that the matter concerns what customers expected to pay for using CommBiz accounts.
According to ASIC, customers were told that fees applied to payments sent to or received from third-party accounts. But the bank, the regulator alleges, also charged an additional undisclosed fee when money moved into or out of the customer's own CommBiz account. ASIC says the terms of service did not disclose these corresponding fees associated with transfers within a customer's accounts. The fee mechanism shows how an additional cost could arise alongside the payment fee disclosed to the customer. The lawsuit is based on the allegation that these fees were not clear to customers when they used the service.
ASIC cited the example of a small business paying two weeks' wages to 10 employees from two CommBiz accounts. It says the transaction resulted in 12 fees: 10 fees for payments to employees and two undisclosed fees for withdrawals from the company's accounts. The example shows how the additional fee could recur in a single payment distributed among several recipients. According to ASIC, the fees at issue relate to corresponding movements of money between CommBiz accounts, not solely to fees for transfers to employees. It says a large number of customers incurred fees of this kind during the period covered by the lawsuit.
ASIC says customer complaints about the matter had reached the bank by at least 2015. An internal audit conducted in 2016 also found excessive fees on direct debit transactions and recommended corrective action. These events provide a timeline for the case, which covers fees charged to customers between November 2020 and May 2025. The bank, meanwhile, said it had reported the matter to ASIC on its own initiative and cooperated with the investigation. But it does not accept some of the allegations and expects to defend aspects of the case while continuing to engage with the regulator.
The bank said it temporarily stopped the fees in question in June 2025 and amended CommBiz's terms in August of the same year. ASIC says the bank has waived "counterparty" fees for customers since February 2026. Under a broader remediation program covering current and former customers from 1 December 2006 to the present, the bank has paid more than A$26.4 million to about 93,000 customers, including nearly 40,000 small businesses. These payments relate to the remediation program announced by ASIC, while the A$8.5 million remains part of the value of the fees it alleges were charged during the period specified in the case. ASIC did not say that the remediation payments resolve the court dispute or determine the outcome of the lawsuit.
ASIC is asking the court to make declarations of contraventions and impose financial penalties, as well as publication and ancillary orders and an order requiring the bank to pay costs. The court had not set a case management hearing date when ASIC issued its statement. In trading, Commonwealth shares rose 1.6% on the day of Reuters' report, while the Australian banking sub-index gained 0.2%. Reuters described the case as ASIC's first major move under its chair, Sarah Court, who took office on 1 June 2026. The next court step depends on the hearing date being set.