HSBC Australia sued over scam inaction

June Chen

Australia's corporate regulator sued the local affiliate of HSBC (0005), claiming it failed to correctly respond to about 950 reports of customers losing a total of around A$23 million (HK$113.57 million).

The Australian Securities and Investments Commission accused that it takes an average of 145 days for the bank to process complaints from defrauded customers, which is unacceptable.

ASIC Deputy Chair Sarah Court said, "We allege HSBC Australia's failings were widespread and systemic, and the bank failed to protect its customers."

"We allege that from at least January 2023, HSBC Australia was aware of the risks of unauthorized transactions occurring and that there were gaps in their fraud controls. This resulted in some customers getting scammed out of A$90,000 or more."

"We allege HSBC Australia compounded the problem by failing to comply with its obligations under the ePayments code and let its customers down when they needed their help the most, on average taking 145 days to investigate customers' reports that they had been scammed," the officer said.

In other news, The Hongkong and Shanghai Banking Corporation Asset Management launched global investment funds - strategic duration and income bond yesterday, which aims to offer a fixed monthly payout of 7 percent. The fund mainly invests in a portfolio of fixed-income securities with an average duration of around three to eight years.

The bank said the global market has become volatile with increased uncertainty. For bond investors, a medium-term investment strategy can help reduce interest rate risk.