$90m back to Kiwi households and other wins from 20 years of CCCFA enforcement
The Commerce Commission has secured three final settlement agreements before it passes responsibility of the Credit Contracts and Consumer Finance Act (CCCFA) to the Financial Markets Authority (FMA) and is reflecting on 20 years of important work in consumer protection.
The three settlement agreements are with ASB, TSB, and Nelson Building Society who have all admitted to breaching the responsible lending requirements set out in the CCCFA. The three lenders failed to have adequate systems and processes to ensure they complied with their obligations under the CCCFA. Impacted borrowers will be proactively remediated by the relevant lender if they haven’t already been.
“The CCCFA has been a significant function at the Commission for the past 20 years and these settlements bookend a successful portfolio of enforcement,” Commerce Commission Deputy Chair Anne Callinan says.
“We’ve taken action across the spectrum of lenders under the CCCFA, big and small. The constant throughout has been a focus on protecting consumers.
“Through this work to protect borrowers we’ve gained insights into the hardship some households face, which has helped us understand the impact of our work and make considered and measured choices in what we do.
“Although the CCCFA role is moving to the FMA, we will continue to put consumers at the heart of our work as we address complex, economy-wide competition challenges.
“We’ve worked closely with the FMA to ensure the transfer of the CCCFA is smooth for borrowers and lenders, and that this important work can continue seamlessly.
“The final settlements we have secured mark the closing of a significant chapter, in which over 20 years the Commission took more than 60 cases to court, won penalties and reparations of over $100 million in total, and oversaw remediation of close to $90 million back to consumers,” Ms Callinan says.
The official date of transfer is tomorrow, 1 July 2026, and will create a single conduct regulator for financial markets.
The Commission is reminding lenders and borrowers to refer CCCFA matters to the FMA.
Background
As part of the settlements, all three lenders have agreed to the Commission seeking declarations in relation to breaches of section 9C(1) and pecuniary penalties under section 107A of the CCCFA.
ASB Bank
ASB self-reported and has admitted breaches of lender responsibility principles, in relation to:
- Failing to conduct affordability and suitability assessments when establishing or varying overdrafts
- Failing to have sufficient systems or processes in place for ensuring the required disclosure was provided for overdrafts
- Failing to detect and reimburse customer overpayments
TSB Bank
TSB self-reported and has admitted to breaches of the lender responsibility principles, in relation to:
- Failing to have sufficient and robust processes and controls in place to ensure compliance with the lender responsibility principles
- Failing to have suitable governance arrangements in place to ensure that its overdraft products were consistently assessed for compliance with applicable lender responsibility principles
- Some of the breaches resulted in borrowers being overcharged and some breaches resulted in borrowers not being sent all the information that TSB should have provided
Nelson Building Society
Nelson Building Society self-reported and has admitted breaches of lender responsibility principles, in relation to:
- Interest overcharges
- Failing to have adequate systems, processes, and controls to provide continuing disclosure and the required information and documents to borrowers and guarantors when loans were changed
- Failing to conduct proper affordability assessments for 37 migrant workers
Nelson Building Society has also admitted to breaching section 18 of the CCCFA.