First of big four to face class action

WESTPAC has been hit with a class action by mortgage customers who claim they were handed loans in breach of responsible lending laws.

It is the first such legal action against one of the big four lenders since the release this month of the financial services royal commission’s final report. The case, lodged in the Federal Court yesterday, is being fought on behalf of people who, after January 1, 2011, were given unsuitable loans by Westpac, allegedly in breach of its responsible-lending obli- gations. It has been launched by law firm Maurice Blackburn and is being supported by global litigation funder Harbour. Westpac said it would fight the action.

“Westpac takes its responsible lending obligations very seriously and will be defending the claims against it,” the bank said in a statement yesterday.

Maurice Blackburn principal lawyer Ben Slade said Westpac was unrepentant despite criticisms made in the royal commission. “Westpac is required to comply with strict obligations which are specifically designed to protect consumers from irresponsible lending and the risk of financial hardship,” Mr Slade said.

“This case will seek to prove that Westpac failed to comply with these obligations and that this failure caused substantial losses for many consumers. Westpac’s response to Commissioner (Kenneth) Hayne’s findings in the financial services royal commission, and to the ongoing proceedings brought by ASIC (Australian Securities and Investments Commission) in relation to Westpac’s responsible lending obligations does not reveal any acceptance by Westpac of its obligations to compensate those who have suffered, and are suffering, at the hands of the company.”

The lead plaintiffs in the case are Michelle and Ian Tate who were handed loans in excess of $1.8 million across five properties from 2008 to 2016.

Shares in Westpac gained 1.3 per cent yesterday.