Former NAB banker pleads guilty to fraud over role in Sydney home loan scam

An ex-NAB branch manager has pleaded guilty to fraud over his role in a home loan referral scam.

NAB last year said it had sacked 20 bankers and punished another 32 for submitting home loan applications without accurate customer information or documentation. Picture: AAP

A former NAB branch manager has pleaded guilty to fraud over his role in an alleged multimillion-dollar scam in Greater Western Sydney that exploited the bank’s “introducer” home loan referral scheme.

Mathew Alwan, who was last year permanently banned from working in financial services, yesterday pleaded guilty to one count of intention to defraud by false or misleading statement in relation to 24 mortgage applications submitted between October 2013 and September 2015.

The rogue branch manager told the bank that an “introducer” had referred the 24 borrowers when it was in fact his uncle, operating under the business name Suit Club. As a result of the fraud, NAB paid Suit Club $56,995 in commissions.

Mr Alwan’s actions were allegedly part of a wider scam a number of NAB bankers were operating in the Greater Western Sydney area concerning the loans referral scheme. The “introducer” program remains in operation. It was the first case study heard in last year’s banking royal commission, which kicked off a horror year for the bank that claimed the scalps of both its chief executive and chairman.

The “spot and refer” introducer program allowed third party “introducers” to refer the name and contact details of potential borrowers to the bank. If the borrower subsequently took out a loan with NAB, the introducer would receive a percentage of the loan amount as a commission. Between 2013 to 2016, the program generated $24 billion dollars in loans.

NAB last year said it had sacked 20 bankers and punished another 32 for submitting home loan applications without accurate customer information or documentation. Around 2300 of the bank’s home loans were affected by the alleged fraud.

On Wednesday, a NAB spokesperson confirmed the bank had completed the remediation program for affected homeowners but could not advise on the total amount paid out. Last year, NAB estimated to the banking royal commission that it expected to pay out “at the lower end of the range of $9 million to $23m.”

The bank announced in March that it would terminate the heavily criticised introducer program, but not until October 1 this year, the start of its financial year.

“Like other businesses, we will still welcome referrals and will continue to build strong relationships with business and community partners. However, there will be no ‘introducer’ payments made,” CEO Philip Chronican said at the time.

The bank was slammed last year when it was revealed it withheld from the banking royal commission a document which showed it was aware of widespread fraud in the “introducer” program for months before it informed the regulator.