Australian banks could face prosecution, damning report by Royal Commission shows

A handful of Australian one dollar coins is shown in Sydney, February 18, 2004. The Australian dollar rose above 80 U.S. cents on Wednesday afternoon for the first time in nearly seven years, as Australia's high interest rates continued to attract global funds.
Photo credit: File

Many of Australia's major banks could be criminally prosecuted in the wake of a damning report released on Monday.

The Royal Commission has found 24 instances of possibly criminal corporate behaviour in the banking sector, which it has referred to industry regulators.

The long-awaited report is the culmination of the "fees-for-no-service" scandal that saw customers charged millions for advice - services they did not receive.

Commissioner Kenneth Hayne has made 76 recommendations that are likely to drastically change the country's financial sector.

The Australian Government, which was given the report on Friday (local time) has immediately agreed to act on all 76 of those recommendations.

Treasurer Josh Frydenberg has promised to set up a compensation scheme for the victims of the banks' misconduct, which will be funded by the industry.

"From today the sector must change, and change forever," he said in a statement.

Prime Minister Scott Morrison is in somewhat of an awkward position, as he voted against the Commission's inquiry 26 times.

All four major New Zealand banks (ANZ, ASB, BNZ and Westpac) have Australian parent companies.