Government Exempts ANZ Class Action from Retrospective CCCFA Bill Rules
The New Zealand government has abandoned plans for retrospective legislation that would have impacted a significant banking class action against ANZ. This decision follows recommendations from the Parliamentary Finance & Expenditure Select Committee.
Government Response to CCCFA Bill Concerns
On Monday, Scott Simpson, the Minister of Finance, announced the government’s U-turn on retrospective provisions of the Credit Contracts and Consumer Finance Amendment (CCCFA) Bill. The select committee advised that ongoing court cases should remain exempt from the proposed changes.
“The committee received 1,543 submissions opposing the retrospective action, with only 15 in support,” Simpson stated. Legal professionals and academics voiced their concerns about the implications of the retrospective legislation.
Implications for the ANZ Class Action
The lead attorney for the plaintiffs, Scott Russell of Russell van Hout, welcomed the decision, calling it a victory for consumer rights. This class action, initiated against ANZ and ASB in 2021, focuses on claims of inadequate disclosure related to loan variations between 2015 and 2019. Plaintiffs are seeking refunds for all fees and interest paid during this period.
- ASB has agreed to a settlement of $135.6 million, pending High Court approval.
- ANZ plans to contest the claims made against it.
Comments from ANZ
ANZ’s Chief Executive, Antonia Watson, criticized the class action, asserting that it exploits legislative loopholes. She contended that due to a previous error in a loan calculator, customers were ultimately undercharged by $2 per month over a year. ANZ reported the issue and incurred $35 million in penalties, claiming no harm was inflicted on customers.
Concerns Over Financial Sector Impact
The Reserve Bank estimated that a worst-case scenario could impose a burden of $12.9 billion on the financial sector if retrospective provisions were applied to existing cases. To address these concerns, the CCCFA Bill included provisions designed to alter the legal standards applicable to new cases, shifting them to be “just and equitable” rather than mandating full reimbursement.
Acknowledgment of Public Sentiments
Simpson acknowledged the feedback received during the select committee hearings, expressing gratitude to those who submitted their views. He emphasized that the government aimed to amend ineffective legislation while ensuring fair outcomes in court.
Future of the CCCFA
Though the retrospective changes will apply to new cases, they will not affect the ongoing ANZ class action. Simpson admitted that the controversy surrounding the retrospective legislation had overshadowed other essential elements of the CCCFA, which aims to simplify credit access.
- The CCCFA will transfer regulatory oversight for consumer credit to the Financial Markets Authority.
- Directors of credit providers will no longer face personal liability for poor loans.
- Restrictions affecting responsible lending practices introduced in 2021 will be eased.
The class action against ANZ is scheduled for a hearing in the High Court in March 2026, marking a significant milestone for consumers seeking justice in the financial sector.
