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Consumer and anti-gambling advocates flagged legal activity between hours of the product being revealed at the bank’s total-year profit proclamation in Brisbane yesterday, as revealed solely by brisbanetimes.com.au today. Independent Senator Nick Xenophon, who staunchly opposes gambling, also spoke out about the account today. Mr Xenophon said he would prosecute authorities to justify why the product was approved and he intended to raise the issue in Senate Estimates the following week. The Win Account, to be launched on November 15, will be the 1st of its variety in Australia and is based on matching products in New Zealand.

It has little fees and offers an yearly interest rate of 1 per cent, compared to most other savings accounts that propose about 4.5 per cent. Customers will be lured to the Win Account on the chance they can win the $20,000 1st award in a monthly lottery, with an initial total prize pool of $30,000. When a minimum $250 is deposited, every dollar in the account will gain a ticket in the lottery. But a client who deposits $1000 into the account stands to lose about $35 per year in interest. Customer groups GetUp! and Choice, which are already pursuing class action against 12 banks for what it claims are dishonest fees, have mooted similar action against Bank of Queensland.

Choice spokesman Christopher Zinn said the account was “unreliable” and would encourage gambling, while GetUp! described it as an “dishonest” banking practice. The Salvation Army’s head of trouble gambling services, Gerard Byrne, said the product was improbable to impact current problem gamblers, who generally did not save money. Nonetheless, it would ultimately prompt new gamblers. Mr Liddy said yesterday the bank had created the account because it was unable to offer competitive interest rates compared to the prominent four. He rejected suggestions it would encourage gambling. “It’s not gambling. You’re putting your money safe and sound in a bank and being eventually rewarded … you’re not putting your funds at jeopardy at all,” Mr Liddy said. “It’s a special account that will attract to some people and some it won’t. We’re not trying to order to people what they do, people will make that decision. “All our market inquiry and the behaviour of the product in other markets suggests some people will love it, others won’t touch it.”

Finance with No Monthly Charging And No Min Balance Required. Sign up today! Australia’s banking regulator says it had no idea of the Bank of Queensland’s controversial new savings account that offers tickets in a monthly lottery rather than a higher interest rate, despite claims it had approved it. The account has been criticized for supporting gaming because it requires customers to forego an ordinary 3.5 per cent in annual interest for the possibility to win $20,000 a month. In standing up for the account yesterday, Bank of Queensland (BoQ) chief administrator David Liddy said the corporation had gone through two years of scrutiny and been approved by the Australian Prudential Regulation Authority, as well as and state lottery commissions.

Advertizement: Story continues beneath But an APRA spokesperson said the regulator had just learned about the product the previous day. It had not approved the account, nor was it needed to. BoQ chief operating officer Ram Kangatharan was forced to defend his boss, who was on a airplane when the discovery was made. Mr Kangatharan apologised and said Mr Liddy had been incorrect. However, he said the account had been given the go ahead by the important state and territory drawing commissions, who regulated savings accounts with trade promotions. “We can pretty much go ahead with it,” Mr Kangatharan said.