A week later, Lei returned to the branch twice. She opened a new account in her sole name and asked that any instructions from Cho about the joint term deposit be confirmed with her first. On the second occasion, she raised concerns about her English signature being copied and asked that her Chinese signature be used for all future transactions.

In June 2024, Lei and Cho instructed the bank to send $250,000 from the maturing term deposit to Cho’s Australian account and reinvest the remaining $250,000. In September 2024, Lei and her daughter Mei asked the bank to close the joint term deposit and transfer the money to Lei’s personal account. Cho objected, and the bank placed a hold on the money. Lei later revoked Cho’s enduring power of attorney and appointed two of her daughters instead.

She complained that the bank had not properly explained the implications of joint account ownership and that she thought she was giving Cho access to her accounts as a signatory, rather than a full joint account holder. She said it was not her intention for Cho to be able to prevent her from accessing her own funds.  

Our investigation

Our task was to consider whether the bank acted with reasonable care and skill when it added Cho as a joint account holder and when Lei returned to the branch a week later. The bank’s policy required staff to speak separately with the customer, explain the implications of joint ownership, and document the interaction. The bank’s policy was largely consistent with our expectations of what banks should do in this situation. However, the bank had kept limited documentary evidence about the steps it took to meet its obligations. We found there was no evidence that staff met separately with Lei, explained the implications of what she proposed to do, or discussed other options such as using an authority to operate or power of attorney.

Lei was in a vulnerable position. She relied on Cho to translate for her at the branch, and he benefitted from the changes made. The bank did not confirm that Lei understood the implications or that the instructions were her own. There was no evidence that the bank had any discussions with Lei regarding other options available to her, such as giving Cho the authority to operate her account, or adding him as an enduring power of attorney. We found the bank failed to act with reasonable care and skill.

When Lei returned to the branch on two occasions a week later, she raised concerns about the joint account and her signature, but the bank did not follow up or take any action. We found the bank failed to meet its obligations to act with reasonable care and skill on both occasions.

As for assessing the impact of the bank’s failures, we could not with any certainty say what steps Lei would have taken if the bank had acted with reasonable care and skill when she initially went to the branch with Cho. She trusted Cho and wanted him to help with her banking. When she visited the branch on two occasions a week later, we considered it likely Lei would have reassessed her banking arrangements if the bank had asked her about what she was trying to achieve by involving her son in her banking and then explaining in detail the various options available to her. What she would have done with this information is hard to say.

Given the bank’s failures, we considered it should take some responsibility for the position Lei was now in – she was unable to access her money and might need to take legal action to regain control of it. While we were not satisfied that Lei had suffered any direct financial loss as a result of the bank’s failures, she had suffered significant distress and inconvenience. We recommended the bank pay Lei $10,000, the maximum amount we could award for stress and inconvenience.

Outcome

Lei accepted our recommendation.