Sept 15 (Reuters) – ME Financial institution, a unit of Financial institution of Queensland (BOQ.AX), appeared in court docket over prison expenses for allegedly making false representations to prospects about rates of interest and repayments, Australia’s securities regulator mentioned on Wednesday.

The digital financial institution had a court docket listening to on Tuesday and faces 62 expenses introduced by the Australian Securities and Investments Fee (ASIC) in Could for notices it offered residence mortgage prospects between September 2016 and September 2018.

The regulator alleges the problems occurred as a result of failures in ME Financial institution’s methods and processes.

ME Financial institution self-reported the problems to ASIC in October 2018 and paid A$105,000 to compensate affected prospects, a Financial institution of Queensland spokesperson mentioned.

“BOQ Group was conscious of this matter through the due diligence,” the spokesperson mentioned, including that it was working with the prosecution on “a approach ahead”.

The subsequent listening to shall be on Nov. 3, ASIC mentioned. Previous to being taken over by Financial institution of Queensland in July, ME Financial institution was owned by 26 trade pension funds.

($1 = 1.3661 Australian {dollars})

Reporting by Riya Sharma and Nikhil Kurian Nainan in Bengaluru; Enhancing by Devika Syamnath and Shounak Dasgupta

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