NAB lost millions in alleged fraud

The chief of staff to NAB CEO Andrew Thorburn resigned in December after a complaint about an alleged corporate fraud.

Human Group CEO Helen Rosamond at her offices in North Sydney yesterday as it is being raided by police.

The chief of staff to National Australia Bank chief executive Andrew Thorburn resigned in December after a whistleblower complaint was lodged about an alleged corporate fraud arrangement that siphoned millions of dollars out of the bank.

Mr Thorburn told his employees the allegations, if proven, would be “a very serious breach of trust” and “really hurt” the bank’s reputation.

While Mr Thorburn did not name people being investigated in the alleged fraud, The Australian can reveal one was Mr Thorburn’s long-serving chief of staff Rosemary Rogers, who resigned from the bank in late December following the internal whistleblower complaint.

NAB yesterday confirmed it was targeted by an alleged corporate fraud after Strike Force Napthali, established by NSW State Crime Command’s Financial Crimes Squad, raided several buildings connected to a group the bank had told police was obtaining contracts through an alleged relationship that centred on inflated invoices.

Offices of the Human Group, which provided executive services and event management logistics to NAB for about a decade, were raided and a large number of documents and electronic storage devices seized by police. The Potts Point, Sydney house of Human Group chief executive Helen Rosamond was also raided. The Human Group did not respond to requests for comment.

Strike Force Napthali was set up to investigate kickbacks for corporate contracts.

“I want to let you know that, this morning, NSW Police informed us of the execution of a search warrant involving a former supplier of the bank,” Mr Thorburn said in an internal memo seen by The Australian. “There will be media and external commentary on this, and I wanted to inform you of the situation.

“This matter has been investigated by us, and was reported quickly to police, and we will continue to fully co-operate with them. The people under investigation no longer work with the bank, or are involved with us.

“There are no customers involved or impacted. We will not be commenting further while this remains under Police investigation.”

NAB ended its relationship with the Human Group in January this year after an internal review raised concerns about the relationship between the two companies. NAB had given the findings from its review, which was sparked by an internal whistleblower complaint, to investigators. The scheme allegedly involved a person receiving commissions for making the lender pay inflated invoices.

Ms Rogers, who did not respond to requests for comment and hung up when contacted yesterday, worked at NAB for more than 20 years. She held the role of chief of staff to the chief executive since 2009, serving former boss Cameron Clyne and, from 2014, Mr Thorburn.

The Australian is not suggesting the allegations are true, only that they are being investigated. Nor is it suggesting any wrongdoing on the part of Ms Rogers, who now runs her own consulting group in Melbourne, according to her LinkedIn profile. NAB provided its findings from an internal review to police mid-February.

“If these allegations are proved to be true it is a very serious breach of trust and banking is based on trust,” Mr Thorburn told staff in a video message late yesterday. “These sorts of allegations really hurt our reputation.”

While the royal commission into financial services has uncovered several instances of misconduct, inappropriate selling and predatory lending, there is a growing focus on the relationship between the lenders and contracting companies, which reap hundreds of millions of dollars in contracts each year.

In a separate case, former Commonwealth Bank general manager of IT, Jon Waldron, is expected to stand trial after the NSW Local Court found there was a reasonable prospect a jury could convict him of bribery and deception. Mr Waldron is facing seven charges of corruptly receiving a benefit of more than $15,000. He is accused of using CBA funds to purchase unnecessary software in return for cash kickbacks.

Financial Crimes Squad Commander, Detective Superintendent Linda Howlett, said detectives were working closely with NAB’s internal investigators to establish exactly what had occurred.

“Our corporate corruption team has been working tirelessly to track payments and other funds to determine if an offence has been committed,” Ms Howlett said. “From the information we have gathered so far, we know there are people who have significant information that may assist us, and we are appealing for them to come forward.

“These investigations are complex and often protracted, but it’s likely even a small piece of valuable information or insight could assist us in resolving the matter swiftly.”

The Human Group planned large corporate events for NAB.