Poll shows public oppose law change to protect ANZ and ASB banks

Tuesday, 15 July 2025

ANZ is one of two banks facing a class action lawsuit that could cost them tens, if not hundreds of millions of dollars. The Government is looking to retrospectively change the law so the costs of losing it would be lower.

A law that would protect the ANZ and ASB banks from a multimillion-dollar compensation claim for loan disclosure mistakes they made between 2015 and 2019 is unfair, and does not have the backing of the majority of people, MPs have been told.

On Wednesday, the Finance and Expenditure select committee will hear from critics of proposed changes to the Credit Contracts and Consumer Finance (Amendment) Act.

The bill, announced by Commerce and Consumer Affairs Minister Scott Simpson in April, would limit the liability ANZ and ASB have under a class action being taken against them by thousands of their borrowers, and followed many years of lobbying by banks.

Simpson acknowledged it was “unusual” for a bill to be retrospective and interfere with a case before the courts, but he described the current law as a “really bad law” with a punitive effect.

Ahead of the select committee hearing, the lawyer for the class action against ANZ and ASB released a poll commissioned from market research company Curia, showing 79% of people did not support Parliament passing a law that helped the banks avoid accountability.

And 77% did not agree with politicians interfering in the active court ANZ and ASB class action case, which was launched in 2021.

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“This is about fairness. We believe the banks broke the rules and need to front the consequences,” said Scott Russell, the lawyer leading the class action.

“Changing the law at this stage only serves to protect the Aussie banks and sends a dangerous message that big corporates can get a ‘get out of jail free’ card when things get tough,” Russell said.

If passed, and assuming the banks lost the case, the proposed law would allow the courts to reduce the compensation the two banks would otherwise have to pay to the 170,000 plaintiffs.

The law the plaintiffs are suing the banks under came into force in 2015 under a National government led by Sir John Key, who became ANZ New Zealand’s chairperson after leaving Parliament.

2015 was a good year for Prime Minister John Key, but his government passed one lending law that would come back to haunt ANZ New Zealand, which he later became chairperson of.

It required lenders to refund all costs of borrowing, meaning fees and interest charged, during any period in which they were in breach of loan disclosure laws designed to ensure borrowers were fully informed about their loans, a measure designed to protect vulnerable borrowers.

Simpson’s Credit Contracts and Consumer Finance (Amendment) Act would change that law retrospectively so the courts would be able to apply discretion to ensure an outcome in cases like the ANZ and ASB class action was “just and equitable in the circumstances, irrespective of when the failure occurred”.

It would allow the court to take into account the level of harm caused by a lender’s mistake when deciding on how much compensation to award.

The bill for the proposed law specifically named the ANZ and ASB class action.

Auckland lawyer Scott Russell is taking a class action lawsuit against ASB and ANZ.

Simpson claimed the bill would not change the outcome of the ASB and ANZ class action, but would give the courts the power to apply discretion over any awards payable to borrowers.

However, the litigation lender funding the class action said retrospective changes in the law were an existential threat to its business. That was because it signalled any class action funded would face the risk of a future government passing similar retrospective law changes.

That funder LPF Group said: “The Government has stated that this bill is “necessary” to protect the solvency of small, domestic lenders and to ‘simplify compliance’. However, the only parties currently affected by the litigation, ANZ and ASB, are subsidiaries of two of Australia’s largest and most profitable banks.

“These institutions have confirmed that the class action poses no risk to their solvency as evidenced by their not having made any public notification to their shareholders or the ASX.“

Russell said the retrospective law change was not in the public interest, and the public did not want it.

Russell said only 22% of people surveyed by Curia believed the court case posed any risk to the financial stability of the two banks.

The 2019 Legislation Act sets out the principles for law-making, and clause 12 states: “Legislation does not have retrospective effect.”

However, the act also makes it clear that Parliament is sovereign, and legislation passed by Parliament can be retrospective, if it states it is.