Commonwealth has become the first major bank to face criminal charges in the wake of the Royal Commission, after its life insurance arm was accused of unscrupulous practices.
CommInsure was hit with 87 separate charges this week, all related to the breach of anti-hawking laws, after it hired a telemarketing firm to sell insurance products.
According to a statement from ASIC, CommInsure used telemarketing firm Aegon Insights to unlawfully sell life insurance policies over the phone, between October and December 2014.
CommInsure provided customer contact details to Aegon from Commonwealth’s existing customer database and calls were unsolicited.
A statement from the bank indicates the breaches were self-reported but Treasurer Josh Frydenberg said banks need to face the full force of the law.
The maximum penalty for each of the charges is $21,250, or $1.8 million in total
The Commonwealth Director of Public Prosecutions is prosecuting the case. The matter has been listed for first mention on November 19 at the Sowning Centre Local Court in Sydney.