NAB/MLC relied on adviser attestations on fees

National Australia Bank and MLC were prepared to rely on “adviser attestations” that they had provided services to clients to enable the banking group to retain fees in the face of “fee for no service” concerns.

The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry heard from NAB’s chief customer officer, Michael Hagger that faced with “fee for no service” concerns from the Australian Securities and Investments Commission (ASIC) the banking group had gone looking for physical evidence of interactions between advisers and clients.

Under questioning from counsel assisting the Royal Commission, Michael Hodge QC, Hagger acknowledged that in order to retain fees the banking group had looked to see whether there was physical evidence of interaction between advisers and clients.

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He also acknowledged that the banking group was prepared to seek adviser attestations as to whether or not the advisers had provided services to particular clients.

“And if they [the advisers] attested that they had provided the services, then you wouldn’t see a reason to repay the fees?” Hodge asked.

Hagger agreed that this was the case, but claimed that the adviser attestations would be subject to assurance.

However, Hagger also agreed with Hodge that in the absence of adviser attestations, the bank would be asking customers to attest that they had actually not received services.

Hagger said the NAB/MLC position was that if there was evidence that a service had not been provided, then the bank would refund the fees.


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