November 28, 2019 / 3:17 AM / 10 days ago

UPDATE 1-CBA's insurance arm convicted for cold calling, fined less than maximum penalty

(Adds regulator comment)

Nov 28 (Reuters) - Commonwealth Bank of Australia’s life insurance arm was convicted of 87 counts of cold-calling offences but fined less than half of the maximum penalty allowed, the country’s corporate regulator said on Thursday.

The Australian Securities and Investments Commission (ASIC) had charged the CommInsure unit of the nation’s biggest lender of breaking an “anti-hawking” law, accusing it of selling life insurance policies over unsolicited phone calls between October and December 2014. CommInsure pleaded guilty this month to all 87 counts of breaching the law.

ASIC said CommInsure was fined A$700,000 ($475,020) by a local court in Sydney for charges that could have totaled A$1.8 million if not for the guilty plea.

Under new laws effective from March, the maximum penalty could have been about A$11 million, the regulator added.

CBA did not respond to a Reuters request for comment.

The case highlights the immense scrutiny Australia’s big banks have come under over the past few years for various misdeeds, including for widespread profiteering exposed by a public inquiry into the sector last year.

“The conviction and sentence today sends a significant message to the financial services industry,” ASIC Deputy Chair Daniel Crennan said in a statement. ($1 = 1.4736 Australian dollars) (Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Shri Navaratnam and Himani Sarkar)

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