This is an enforcement action by the Commerce Commission against TSB Bank for breaches of consumer lending regulations under the CCCFA, specifically regarding overdraft products and lender responsibility principles.
The breaches involve overdraft products and consumer credit governance, which relate to bank account management and consumer lending compliance frameworks.
Specialism
The enforcement action targets a bank's breaches of consumer credit lending principles, which falls outside the payments-specific regulatory scope; this is consumer credit regulation rather than payment services regulation.
Customer Protection could apply to the overcharging and information disclosure failures affecting borrowers, but the core issue is credit lending governance rather than payment service customer protections.
2026-07-01 08:41:46·kgurnani@vixio.com
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TITLE: New Zealand Commerce Commission Files Civil Proceedings Against TSB Bank Limited for Lender Responsibility Breaches
BODY:
On October 10, 2024, the Commerce Commission filed civil proceedings in the High Court against TSB Bank Limited seeking declaratory orders and pecuniary penalties for breaches of the Lender Responsibility Principles under the Credit Contracts and Consumer Finance Act 2003 (CCCFA).
The breaches primarily occurred between June 6, 2015 and November 30, 2021, with certain issues continuing until December 1, 2023. TSB self-reported the violations and admitted that it failed to maintain sufficient and robust processes and controls to ensure compliance with the Lender Responsibility Principles. Specifically, TSB lacked suitable governance arrangements to ensure its overdraft products were consistently assessed for compliance with applicable requirements. Some breaches resulted in borrowers being overcharged, while others resulted in borrowers not receiving all information TSB was obligated to provide under the Lender Responsibility Principles. The breaches relate to sections 9C(2)(ii), 9C(1), and 9C(2)(iii) of the CCCFA.
TSB consented to the Commission seeking the orders following a settlement agreement entered into by the parties in advance of filing. The case (reference numbers PRJ0047707 and PRJ0048948) remains open. This action demonstrates the Commerce Commission's enforcement focus on lender compliance with consumer credit protections, particularly regarding governance and product assessment processes. Financial institutions offering credit products should review their compliance frameworks to ensure robust controls are in place for assessing products against the Lender Responsibility Principles and for maintaining accurate borrower records and communications.
TSB Bank Limited | Commerce Commission Home chevron_right Case register chevron_right TSB Bank Limited TSB Bank Limited Share this: Share this: The Commerce Commission has filed civil proceedings in the High Court against TSB Bank Limited seeking declaratory orders and pecuniary penalties in relation to breaches of the Lender Responsibility Principles under the Credit Contracts and Consumer Finance Act 2003 in relation to issues that primarily occurred between 6 June 2015 and 30 November 2021 (with certain issues continuing until 1 December 2023). TSB consented to the Commission seeking the orders following a settlement entered into by the parties in advance of filing. TSB self-reported and admitted that it failed to have sufficient and robust processes and controls to ensure compliance with the Lender Responsibility Principles. In particular, TSB failed 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 some borrowers being overcharged, and some resulted in borrowers not being sent all information that TSB should have provided, in breach of the Lender Responsibility Principles. Case Details Parties TSB Bank Limited Category Consumer credit Sub-category Act/Section Credit Contracts and Consumer Finance Act 2003 ss 9C(2)(ii), 9C(1), 9C(2)(iii) Industry Financial and insurance services Status Open Outcome Case number PRJ0047707, PRJ0048948 Date opened 10 October 2024 Date closed Contact person Hillary Walker, hillary.walker@comcom.govt.nz Print print