Westpac has owned up to raiding the piggy banks of young customers by charging millions of dollars in fees that should have been waived.
The bank has refunded about $9.2 million to customers after staff failed to manually remove monthly service and withdrawal fees from their accounts or failed to sign them up to no-fee accounts.
Westpac opened Choice and Reward Saver accounts for 133,045 customers aged under 21 between May 2007 and April 2013 without manually applying the monthly fee waiver, according to the Australian Securities and Investments Commission.
Another 28,369 teenage customers were signed up to standard transaction accounts at Westpac subsidiary St George Bank instead of student accounts, which do not have monthly service fees.
Westpac discovered and reported the breaches to ASIC, which acknowledged Westpac's cooperation in resolving the matter.
"Financial institutions that offer products with benefits such as fee waivers must have effective and robust systems in place to deliver the promised benefits to consumers," ASIC deputy chairman Peter Kell said on Tuesday.
"Businesses that rely on manual processes to apply waivers, discounts and other benefits should carefully consider how they manage the risks of processes not being followed."
As well as refunding its customers, Westpac said it was updating its systems so waivers were applied automatically based on the customer's date of birth.
Last week, Westpac revealed it had refunded $20 million to credit card customers after it failed to properly inform them they would be charged foreign transactions fees for overseas purchases made in Australian dollars.
And earlier this month ANZ said it would refund almost $29 million to customers after it failed to tell them about fees charged for moving money between accounts.