The FMA has filed High Court proceedings against ANZ alleging the bank charged customers for credit card repayment insurance policies that offered no cover.
The FMA has taken exception to two issues. ANZ is alleged to have issued duplicate policies to some customers, which provided no additional benefits or cover, and charged premiums to customers between April 2014 and November 2019.
The bank is also alleged to have issued and failed to cancel insurance policies for ineligible customers between April 2014 and May 2018.
In a statement, ANZ said it identified the insurance policy issues and reported them to the FMA in June 2019. The bank said it has provided roughly $440,000 in compensation to customers.
"ANZ however acknowledges that it took too long to report the issues to the FMA, and will engage with the FMA on its reporting framework over the coming weeks," the group said.
ANZ identified that 390 customers had more than one credit card repayment insurance policy for their credit card, and a further 439 customers who were ineligible to claim the insurance.