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NAB admits Corporations Act breaches on planner fees
National Australia Bank plus its superannuation business (NULIS) have accepted that it is open to the Royal Commission to find that NULIS breached or was likely to breach the Corporations Act with respect to Planner Service Fees (PSFs).
In a written submission responding to arguments put by counsel assisting the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, the big banking group acknowledged that the breaches may have occurred where fees were deducted from member accounts with no linked advisers.
It said that the same finding was capable of being made with respect to adviser service fee (ASF) deductions.
However, the big banking group pointed out that NAB and NULIS had fully accepted the seriousness of the matters and that the issues had been previously acknowledged and reported upon and had been the subject of remediation.
“It is important to recognise the context in which the PSFs and ASFs were applied, and the steps taken by NAB and NULIS to remediate errors once they were identified,” the submission said.
“…as to the introduction of PSFs and ASFs, the intention was to make the fees payable by members more transparent and easier to understand. NAB was a market-leader in this respect,” it said. “However, NAB and NULIS recognise that, despite the best of intentions, the application of the new fees had flaws.”
“As to remediation, each event has been investigated, reported to the relevant regulator and has been (or will be) remediated,” it said.
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The future of superannuation policy remains uncertain, with further reforms potentially on the horizon as the Albanese government seeks to curb the use of superannuation as a bequest vehicle.
Superannuation funds will have two options for charging fees for the advice provided by the new class of adviser.
The proposed reforms have been described as a key step towards delivering better products and retirement experiences for members, with many noting financial advice remains the “urgent missing piece” of the puzzle.
APRA’s latest data has revealed that superannuation funds spent $1.3 billion on advice fees, with the vast majority sent to external financial advisers.
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