Australia’s NAB To Pay A $1.4M Fine For Wrongly Charging Fees

The National Australia Bank has received a $1.4 million fine from the Australian Federal Court. The fine comes after the bank was accused of wrongly charging fees.

The National Australia Bank is the second-largest lender in Australia, with the fine coming after the bank was found to be incorrectly imposing periodic payment fees on customers.

NAB Gets A $1.4 Million Fine For Unlawful Fees

A Reuters report noted that between January 2017 and July 2018, the bank continued to impose periodic payment fees on customers for fund transfers. The fees were imposed despite the customers not being entitled to the same under the existing contracts.

The Australian Securities and Investments Commission (ASIC) revealed that the bank was wrong to bill 2,888 personal banking customers and 513 business clients for payment fees valued at AUD 139,845.

The Deputy Chair of the ASIC, Sarah Court, noted that financial institutions needed to be cautious and minimize harm to consumers in case systems fail.

The bank noted erroneous charges and acknowledged that some customers were incorrectly charged for periodic payment fees. According to the bank, a remediation program was in place, and it planned to reimburse more than AUD 8.3 million to the affected clients.

Reuters also noted that Australian regulators had fined several companies over non-compliance and breaches. The “Big Four” banks in the country faced the most fines after the Royal Commission started an investigation into the industry.

NAB Continues To Dominate The Banking Sector

In July, NAB blocked over AUD 270 million of customer payments, linking them to crypto scams. The bank also halted several suspicious transactions on crypto platforms.

The Australian Financial Crimes Exchange noted that 50% of reported scams were associated with cryptocurrencies and crypto trading platforms. It opined that scammers exploited the platforms to transfer stolen funds to other countries.

Earlier this year, the National Australia Bank finalized the first intra-bank cross-border transaction using its stablecoin through the Ethereum blockchain.

The transaction was part of a pilot program by NAB related to an AUD-backed stablecoin. It also involved the stablecoin smart contracts for seven leading global currencies to show how blockchain can reduce the time taken in cross-border transactions.

NAB plans to issue its stablecoin under the AUDN ticker. The stablecoin will appear as a liability in NAB’s books. The bank also plans to support transactions for different currencies.