June 18, 2026 — 5:55pmGlobal banking giant HSBC has agreed to pay a $35 million penalty to settle a landmark court case after admitting members of its executive team knew the bank was failing to protect its customers from scam phone calls and did nothing about it.More than 1000 of HSBC’s Australian customers were targeted by the scheme, where scammers used text messages and phone calls with spoofed numbers to convince customers to transfer large sums of cash.More than 1000 of HSBC’s Australian customers were targeted by scam phone calls.BloombergThe Australian Securities and Investments Commission launched Federal Court action in late 2024, alleging the overseas-owned bank’s failings had led to unauthorised transactions with a total value of $34.6 million.A key plank of ASIC’s case was that not only had HSBC failed to protect its customers from the scammers, but the bank caused unnecessary delays and further stress to its account holders after it received complaints.The settlement was approved on Thursday after a short court hearing before Justice Elizabeth Bennett, who initially raised concerns about whether the penalty – representing a fraction of HSBC Australia’s pre-tax profit – was enough of a deterrence against future bad conduct by HSBC and other banks.Both ASIC and HSBC told the court the fine had been discounted due to HSBC’s cooperation with the regulator and the avoidance of a contested trial between the bank and the watchdog.HSBC also apologised to its customers for the first time on Thursday after years of fighting the allegations.“We apologise to our customers who were impacted by these events,” the bank said in a statement.“We are pleased to have reached an agreement to resolve the proceedings with ASIC, which recognises our customer redress program and the significant enhancements made to our fraud and scam prevention, detection and response.”ASIC said that HSBC had already paid around $21.5 million in compensation, with further payments to come. HSBC has also recovered $6.5 million and returned those funds to customers.ASIC chairman Sarah Court welcomed the agreed settlement, believed to be the first in the world that held a bank accountable for the losses of its customers to scammers.ASIC chairman Sarah Court welcomed the settlement between the regulator and HSBC.Court said the settlement sent a warning to HSBC and all other banks and financial institutions in Australia to ensure they not only continued to improve their customer protection policies, but also to act quickly after a customer complained.“It should send a very clear message that banks have an obligation to protect their customers from scams, particularly in circumstances as we had here – where the bank is on notice that there are obviously very convincing impersonation scams of it that are escalating in scale – that its customers are being impacted by it.“So this is a message to all financial institutions, banks and otherwise, that you have an obligation under your financial licensing obligations, to protect customers from these kind of attacks.”Court noted that the banking sector had drastically improved its approach to scam victims since ASIC put the industry on notice in April 2023 and again in August 2024 that their handling of scam victims was falling short of expectations and causing undue additional distress to customers.The government is currently working on reforms, known as the Scams Prevention Framework, to beef up protections offered to consumers by banks, telcos and social media platforms.HSBC scam victim Mary Yu said while she had received most of her money back through the remediation program, she felt the bank should be forced to compensate victims for how they treated them.Scammers hacked into her account and stole a large sum of money without even obtaining her PIN or login details.Yu said when she reported the fraud she was blamed by the bank and made to feel as though it were her fault.“I literally went into a branch, and the branch manager put me through an hour of hell. All that time I was just panicking, and feeling all these emotions.“They were pointing fingers at me when really the bank should have done more, and they didn’t, and all that time they were just putting the blame back on the victims,” she said.Yu said her one ray of sunshine was closing her HSBC accounts after banking with them since high school.“I was just like, ‘thank goodness I don’t ever have to deal with you guys ever again’,” she said.Yu was not alone in experiencing a significant emotional toll from dealing with HSBC, the court heard.New documents filed by the corporate watchdog and HSBC included details of other customers having to undertake additional shifts at work to earn money during the bank’s delays, and people who felt guilty for ever taking the scam call.Other customers, the court heard, feared they could not make their mortgage payments, while another suffered feelings of panic and shame as he felt responsible for losing his family’s money.Start the day with a summary of the day’s most important and interesting stories, analysis and insights. 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