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BFCSA investigates fraud involving lenders, spruikers and financial planners worldwide.  Full Doc, Low Doc, No Doc loans, Lines of Credit and Buffer loans appear to be normal profit making financial products, however, these loans are set to implode within seven years.  For the past two decades, Ms Brailey, President of BFCSA (Inc), has been a tireless campaigner, championing the cause of older and low income people around the Globe who have fallen victim to banking and finance scams.  She has found that people of all ages are being targeted by Bankers offering faulty lending products. BFCSA warn that anyone who has signed up for one of these financial products, is in grave danger of losing their home.


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BFCSA: Hayne royal commission: NAB had 'commercial concerns' about ending commissions

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Hayne royal commission: NAB had 'commercial concerns' about ending commissions

Australian Financial Review Aug 6 2018 6:51 PM

Joanna Mather


National Australia Bank devised a strategy to continue charging the types of commissions banned under the Future of  Financial Advice laws, the banking royal commission heard.

In July 2016, five NAB super funds were merged into one to create the MLC Super Fund.

Earlier, NAB executives sought ways to transfer customers to the new arrangements without relinquishing the capacity to charge "grandfathered" commissions.

Former executive Paul Carter agreed there were "commercial concerns" in relation to revenue.

But he insisted NAB was also worried about angering financial advisers, who might withdraw their clients.

The fund's assets would be depleted, which could in turn leave members worse off, Mr Carter said.

Counsel assisting Michael Hodge was unconvinced.

He asked whether the bank might have been more concerned about fee revenue than clients.

"There would have been a financial detriment to the NAB Group as a consequence of these commissions being turned off?" Mr Hodge asked.

"Yes," Mr Carter agreed.

"And if it's the case that freed of the inducement of commissions, the advisers would move the customers to a different product consistent with the adviser's best interest duty, then that would also be to the financial detriment of the NAB Group?"

"Yes," Mr Carter said.

"Because those members would no longer be part of... the super fund and, therefore, the various fees that are earned on those members and that ultimately are passed back to the NAB Group would no longer be earned?"


Mr Carter insisted the bank was at risk of breaching its contract with advisers by ceasing the commissions.

But Mr Hodge said the trustee, NULIS, was not a party to contracts with advisers at this time – a fact with which Mr Carter was forced to agree.

The commission heard specifically about NAB's Master Key super offerings, which included fees of up to 5.88 per cent of each contribution, 1.5 per cent of the account balance and around one quarter of the annual insurance premium.

The structure was so heavily loaded with fees that a fund member who chose to allocate 100 per cent of their fund to cash was barely able to generate a positive return once all the ancillary charges were accounted for.

The unnamed member ended up paying total fees of $929 for an investment that returned $1032, a difference of $103.

MasterKey members were charged a "plan service fee" for general advice.

Many were unaware they could simply call the bank and opt out of the fee.

"If they deem they would like the fee to be zero, the fee will be zero," Mr Carter said.

Yet product disclosure statements did not explain this.

Mr Hodge said the use of the terms 'negotiate' or 'agree' made it unclear that customers could simply shut off the fee; no negotiation was required.

Estimates of remediation from the bank for these plan service fees were as high as $67 million. However the royal commission revealed this had crept up to $87 million as of last week.

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