NAB in court over $2b fees scandal

THE corporate watchdog has launched legal action against National Australia Bank, alleging its $2 billion fees-for-no-service scandal involved “several thousand” breaches of the law.

And ANZ has revealed it is paying refunds into 3.4 million customers’ accounts, while Westpac has been forced to bolster its books with an extra $500 million in capital amid the child exploitation scandal buffeting that bank.

On another seismic day for the banking sector, the Australian Securities and Investments Commission yesterday accused NAB of unconscionable conduct by charging ongoing fees to customers for services it knew it had not delivered.

ASIC said that from at least May last year, the bank knew it had not delivered the services in question to customers of financial planners, and had issued “defective” fee disclosure statements “or at least knew that there was a real risk that it had engaged in this conduct”.

The watchdog alleges NAB kept charging fees to customers until February 4 this year.

That is the same day the final report from the financial services royal commission was released.

ASIC’S allegations will inflame tension between NAB and shareholders at the annual meeting in Sydney today.

The regulator has launched civil proceedings in the Federal Court, seeking “findings of several thousand contraventions of the ASIC Act and Corporations Act”. The allegations centre on NAB’s conduct from December 2013 until February this year. NAB is also alleged to have failed to set up proper compliance systems and broken its financial services licence obligations to act “efficiently, honestly and fairly”.