Australia’s corporate watchdog filed a lawsuit on Thursday against superannuation funds run by the wealth management unit of National Australia Bank, accusing them of charging fees to hundreds of thousands of retirees for services the were not provided.
The Australian Securities and Investments Commission (ASIC) said in a court filing that the funds, NULIS Nominees (Australia) Ltd and MLC Nominees Pty Ltd, had charged fees for no service to at least 220,000 retirees.
“The commencement of this civil penalty action is part of ASIC’s broad-ranging and significant investigations currently underway into fee for no service failures in the financial services industry,” the regulator said in a statement.
A spokesperson for NAB was not immediately available for comment.
ASIC did not say whether the court action was related to the banking royal commission – a powerful public inquiry that has rocked the Australian financial services industry, wiping more than $30 billion from the collective market value of the country’s top four lenders and top wealth manager.
NAB has said it wants to sell its wealth management arm, in keeping with a broader push by lenders to focus on core operations and avoid any new regulations that result from the inquiry.
Last month the inquiry heard allegations of widespread charging of fees for no service in the country’s $2 trillion pension industry.
ASIC filed the Federal Court lawsuit against NAB a day after it said Westpac had agreed to pay a $35 million fine for using incorrect processes to approve 260,000 home loans.
In the court filing on Thursday, ASIC said NAB had wrongly taken $100 million from customers’ retirement accounts from 2012 to 2018.
ASIC said NAB had agreed to return some of the fees and it expected more refunds from the bank, but “irrespective of the remediation, the conduct…did not promote confident and informed decision making by retail clients”.
ASIC said it wanted court declarations that the bank had broken the law and for NAB to pay unspecified fines.