ASIC launches fee for no service action against NAB

The Australian Securities and Investments Commission (ASIC) has commenced proceedings in the Federal Court of Australia against two entities in NAB’s wealth management division, NULIS Nominees (Australia) Limited (NULIS) and MLC Nominees Pty Ltd (MLC Nominees).

The regulator said the court proceedings relate to fees charged by both entities to a significant number of their superannuation members for services not provided.

The action follows on from recent hearings of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry and ASIC is alleging that NULIS and MLC Nominees (as the current and former superannuation trustee of NAB) misled members of MLC MasterKey Super products.

Related News:

The regulator said it was also alleging NULIS and MLC Nominees deducted approximately $33 million Plan Service Fees from 220,000 members of MLC MasterKey Business and MLC MasterKey Personal Super who did not have Plan Adviser (No-Adviser Members).

It has alleged that NAB also deducted approximately $67 million in Plan Service Fees from 300,000 members of MLC MasterKey Personal Super where Plan Advisers were not required to provide services and members did not receive services (or any services they could not otherwise obtain for free).

Recommended for you




But MLC are turning off ALL Plan Service Fees from MasterKey Business and Personal Super accounts whether or not the member has received service and advice from the allocated adviser or not!
So, if the allocated adviser has provided either general or personal advice and service to the member and has rightfully been remunerated for that service via the Plan Service Fee ( which is technically NOT a fee, but an inbuilt product commission payment-as evidenced and admitted by ex-NAB Executive, Paul Carter at the recent Royal Commission), then it is unconscionable that MLC are electing to remove these adviser remuneration payments on a wholesale level and on every single account without investigation or analysis.
Effectively this decision by MLC is significantly penalising advisers who have provided service and advice to these members and have been remunerated for doing so.
In 2012, MLC deliberately changed the terminology used to describe the adviser payments which were previously included within the Annual Management Fee. They then referred to the adviser payment as the Plan Service Fee and separated this away from the Annual Management Fee, even though this adviser remuneration was effectively still a product commission payment and legally and currently able to be paid.
MLC should not be deleting the Plan Service Fee from any MasterKey accounts that have a current adviser attached and for any accounts that have received either general or personal advice or service.
The advisers are being made the scapegoat for an error that was not of their doing.
MLC should only be turning off the Plan Service fee for accounts that do not have any adviser attached or have not received or had access to general or personal advice.

Add new comment