NAB employees committed no crimes, bank chief Andrew Thorburn tells royal commission

THE corporate cop was ­“concerned” National Australia Bank breached the Corporations Act — leaving it open to possible criminal charges — by charging fees for services it did not provide.

THE corporate cop was ­“concerned” National Australia Bank breached the Corporations Act — leaving it open to possible criminal charges — by charging fees for services it did not provide.

And the watchdog accused NAB of 110 breaches of the law by failing to report to regulators that it had charged fees without providing services, ­according to confidential documents tabled at the banking royal commission.

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The regulator, the Australian Securities and Investments Commission, was concerned that NAB was charging fees for providing general advice services, when no advisers were linked to the accounts in question.

“ASIC is concerned that NAB contravened (the Corporations Act) in relation to the no adviser Plan Service Fee conduct,” the documents said.

“Further ASIC is concerned that NAB’s correspondence to members concerning Plan Service Fees contravened (the ASIC Act).”

NAB chief Andrew Thorburn last night told Business Daily that he did not believe the bank faced criminal sanctions.

“We do not believe they are criminal breaches. I certainly do not believe our people are involved in any criminal acts,” he said.

The issues with ASIC were “not yet resolved” and “not concluded”, he said.

But Mr Thorburn said that if NAB did face criminal charges, it would come from the regulator, not from police.

“If it was a criminal breach it would be from a regulator like ASIC,” he said.

“It’s not police fraud criminal charges — it would potentially be breaches that ASIC would bring against us.”

NAB chief executive Andrew Thorburn. Picture: Kym Smith

Mr Thorburn said the bank should have acted faster on the issue before the royal commission.

So far the bank has had to refund customers about $122 million for charged fees without providing services, but the scandal is deepening. On Wednesday, it was revealed the bank’s superannuation arm also charged fees to more than 4000 dead customers. Those fees are now being paid back to the customers’ estates.

Commissioner Ken Hayne yesterday rejected NAB’s bid to keep quiet its negotiations with the corporate cop over the matter.

Late on Wednesday, legal counsel for the bank Neil Young, QC, fought against the release of a document titled “Outline of offending by the NAB group” — an internal report from ASIC to the bank.

But Mr Hayne yesterday morning said he had to strike a balance between the need for a transparent public inquiry and the need for commercial privacy.

“It would be in the interests of NAB to pay the least sum available — it would be in the interests of the persons charged fees in circumstances where no service has been provided to be provided with adequate compensation,” Mr Hayne said.

“It is in the public interest that there be an open and transparent inquiry.”

The commission has already recommended AMP face criminal prosecution. The documents tabled at the commission reveal ASIC also scolded NAB last year over its attempts to resolve the issue of taking fees but not offering services, saying it was “out of step” with the other big banks.

In another document, ASIC attacked NAB’s methods for seeing if it should remediate customers.

Last year, ASIC said NAB’s suggested approach of waiting for customers to complain they had not received a service before remediating them was not good enough.

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