Latest news with #AFSH
Sky News AU
5 days ago
- Business
- Sky News AU
NAB hit with $15 million fine following shameful act towards struggling Aussies
NAB and its subsidiary AFSH Nominees Pty Ltd have been ordered to pay $15.5 million following a Federal Court case decision made on Wednesday. The big four bank was fined following an investigation where it had failed to respond to hundreds of Australians doing it financially tough. Between 2018 and 2023, NAB and AFSH did not respond to 345 hardship applications within the required 21-day timeframe. Affected customers were left unaware for more than three weeks and didn't know if they would be given leniency. "These failures likely made an already challenging time in people's lives far worse," Australian Securities and Investments Commission (ASIC) Deputy Chair Sarah Court said. "This decision highlights the seriousness of the failures of NAB and AFSH to support their customers experiencing financial hardship. "This penalty sends an important message to other financial institutions – customers should be at the centre of what you do.' Justice Penny Neskovcin said affected customers had asked NAB for help in relation to medical emergencies, family violence, natural disasters, redundancy, and business failures. Justice Neskovcin added NAB and AFSH breached provisions of the National Credit Code. None of the 346 customers who didn't hear back in the required time frame suffered any losses. Justice Neskovcin said the situation could have been helped 'If NAB had provided the affected NAB customers and AFSH customers with the required notices in response to their hardship notices within the prescribed timeframes'. NAB was ordered to pay $13 million while AFSH Nominees will fork out $2.5 million, as well as ASIC's court costs. They will also be required to publish a publicity notice on their website and provide a copy of the notice to affected customers. The notice will provide customers the details of Justice Neskovcin's court order. 'The failures resulted (with a few limited exceptions) from the incorrect use by NAB staff of a particular functionality in its internal system used to manage hardship notices,' the notice reads. 'The causes have since been identified, and NAB has taken steps to address those causes. 'Since ASIC commenced court proceedings, NAB and AFSH have provided affected customers with a response to their hardship notice and conducted a remediation program which included remediation payments and the correction of repayment history information for some affected customers.' has reached out to NAB for comment. Meanwhile, much needed relief arrived on Tuesday as the Reserve Bank of Australia cut interest rates for the third time of 2025. The central bank lowered the cash rate from 3.85 per cent to 3.6 per cent. The National Debt Helpline revealed over 168,000 people reached out for help in the 2024-25 financial year, making it the biggest spike in numbers since 2018-19.
7NEWS
5 days ago
- Business
- 7NEWS
NAB cops $15 million fine for making vulnerable ‘people's lives far worse' with financial hardship failures
Hundreds of Australians doing it tough have been left in the dark by their bank after making requests for financial hardship support. The Federal Court ordered NAB and its subsidiary, AFSH Nominees, to pay a $15.5 million for the failure — a penalty that the Australian Securities & Investments Commission (ASIC) hopes will encourage banks to put their customers first. NAB and AFSH admitted that they failed to respond to 345 financial hardship applications within the legally required timeframe of 21 days. 'As a result, those consumers remained unaware of the outcome of their hardship applications,' ASIC said on Wednesday. Justice Penelope Neskovcin said the total number of admitted contraventions between 2018 and 2023 was 'high' and therefore serious. 'These failures likely made an already challenging time in people's lives far worse,' ASIC Deputy Chair Sarah Court said. 'The hardship regime exists to help customers who are experiencing financial difficulty, often caused by significant life events such as serious illness, sudden unemployment and domestic violence. 'This penalty sends an important message to other financial institutions – customers should be at the centre of what you do.' NAB and AFSH breach sidestepped 'an important formal mechanism to protect consumers who may be experiencing hardship,' Neskovcin said when handing down her decision in court. She said that further impacts to affected customers may have been avoided if they had been given, within the prescribed timeline, 'the required notices in response to their hardship.' An ASIC hardship report in May last year found that lenders across the sector were not doing enough to support customers experiencing financial hardship. NAB and AFSH have agreed to pay the penalty and ASIC's costs. They are also required to publish an adverse publicity notice on their respective websites and to provide a copy of the notice to each customer affected by the conduct.
Daily Mail
5 days ago
- Business
- Daily Mail
NAB is hit with $15million fine for disgraceful act
National Australia Bank and one of its subsidiaries will pay a $15million fine after failing to respond to hundreds of hardship applications. In a Federal Court decision published on Wednesday, the court found the bank failed to respond to 345 hardship applications within the legally required 21-day timeframe. Affected consumers were left unaware of the outcome of their hardship applications between 2018 and 2023. Justice Penny Neskovcin said affected customers had asked the bank for help as they weathered medical emergencies, family violence, natural disasters, redundancy and business failures. ASIC Deputy Chair Sarah Court said the decision 'highlights the seriousness of the failures of NAB and [subsidiary] AFSH to support their customers experiencing financial hardship'. 'These failures likely made an already challenging time in people's lives far worse. 'This penalty sends an important message to other financial institutions – customers should be at the centre of what you do.'
Yahoo
5 days ago
- Business
- Yahoo
NAB fined $15.5 million after failing to respond to hundreds of struggling Aussies: 'Far worse'
NAB and its subsidiary AFSH Nominees Pty Ltd have been ordered to cough up $15.5 million following a Federal Court case. The Big Four bank was fined after an investigation found it had failed to respond to hundreds of struggling customers. Between 2018 and 2023, NAB and AFSH didn't get back to 345 hardship applications within the required 21-day timeframe. These customers were left in the dark for more than three weeks and didn't know if they would be given leniency. "These failures likely made an already challenging time in people's lives far worse," Australian Securities and Investments Commission (ASIC) Deputy Chair Sarah Court said. RELATED CBA, ANZ to deliver mortgage relief before Westpac, NAB customers Huge push for four-day work week to become reality for all Australians Commonwealth Bank's $8 billion cash boost for 13 million Aussies after record profit ASIC brought the case against the bank to the Federal Court and said other lenders should remind themselves of their legal obligations to their customers. "This decision highlights the seriousness of the failures of NAB and AFSH to support their customers experiencing financial hardship," Court added. "This penalty sends an important message to other financial institutions – customers should be at the centre of what you do. "ASIC will not hesitate to take action when banks and lenders fail to comply with their obligations." A damning ASIC report released last year found lenders were making it difficult for customers to get help, with more than a third of people seeking assistance dropping out of the process. The review found banks should be doing more to support Aussies struggling with repayments, with 40 per cent of customers who received hardship assistance - through reduction or referral of payments - falling into arrears right after the assistance period customers left in the dark during their hour of need Justice Penelope Neskovcin revealed during the hearing some of the circumstances that customers were in when they applied for hardship over those six years. They included family violence, issues related to the pandemic, natural disasters, medical issues or emergencies, bereavement, and losing their jobs or their businesses failing. She said the National Credit Code, which stipulates the 21-day response timeframe, is an "important formal mechanism" that's designed to protect customers who are struggling to keep up with their payments. None of the 345 customers who didn't hear back from NAB and AFSH in the required time period suffered any losses. But the court heard their situations could have been helped "if NAB had provided the affected NAB customers and AFSH customers with the required notices in response to their hardship notices within the prescribed timeframes". NAB was ordered to pay $13 million, while AFSH Nominees will have to pay $2.5 million, as well as ASIC's court costs. The bank said it had taken measures to ensure this wouldn't happen again, and 60 customers were paid an average of $540 to cover the impact of the breaches. Aussies in hardship as interest rates fall The Reserve Bank of Australia (RBA) recently cut interest rates for the third time this year, which will provide much-needed relief to homeowners being pushed to the brink by their mortgage payments. The National Debt Helpline (NDH) revealed more than 168,000 people reached out for help in the 2024-25 financial year, highlighting how timely these moves from the central bank have been. Interest rates were at an all-time low during the pandemic, and many jumped into the property market to capitalise on that trend. But as inflation spiked, so too did the cash rate, with the RBA hiking it 13 times between May 2022 to November 2023. It was held at 4.35 per cent until February this year, when the first rate cut since 2020 was authorised. NDH coordinator Vicki Staff said the number of calls in 2024-25 to their helpline was the biggest since 2018-19, and showed just how hard the last year had been. 'Many of life's essentials are just more expensive than they used to be," she said. 'These people are very distressed and worried about their financial future and families.' Those who are still struggling can call the National Debt Helpline on 1800 007 007 or they can jump online and chat with a financial counsellor at
Perth Now
5 days ago
- Business
- Perth Now
‘Far worse': NAB cops $15m fine
National Australia Bank and a subsidiary have been fined more than $15m for failing to respond to hardship applications. In a Federal Court decision released on Wednesday, NAB and AFSH Nominees were found to have left hardship applicants in the dark after failing to respond within 21 days. The Australian Securities and Investments Commission (ASIC) brought the lawsuit. In her decision, Justice Penny Neskovcin details that people who asked the bank for help were going through medical emergencies, family violence, the pandemic and business failure, natural disasters, and redundancy and unemployment. 'These failures likely made an already challenging time in people's lives far worse,' ASIC deputy chair Sarah Court said. NAB failed to respond to hardship application from people going through family violence and natural disasters. NewsWire / Kelly Barnes Credit: News Corp Australia 'This penalty sends an important message to other financial institutions – customers should be at the centre of what you do.' Justice Neskovcin found NAB and AFSH made a 'high' number of breaches of the National Credit Code, in not providing written responses to 345 hardship notices between 2018 and 2023. The hardship claims were knocked back by NAB staff incorrectly clicking a 'reject' button in their system. About 6 per cent of 12,600 hardship applications were incorrectly rejected this way. NAB customer services boss Sharon Cook apologised and said 70 staff had been hired to address the issue. 'We're sorry we let down our customers when they needed our help,' she said. 'We have created NAB Care, a dedicated hardship assistance team, hired 70 new colleagues and increased the support options available to our customers. 'There is more to do, and we will continue to find ways to better support our customers who need us.' Under the National Credit Code, if someone cannot pay their loan, lenders must consider varying the credit contract and advise them of the decision within specified time frames. Payment deferrals, reduced payment arrangements, interest-only periods, term extensions, capitalisation of arrears or interest-rate reductions are all options to get the loan repayments happening again. As well as the $15.5m fine, NAB and AFSH have to publish notices about the breaches on their websites. AFSH Nominees sells mortgages as Advantedge Financial Services. From September 30, Advantedge will stop accepting new home loan applications. From next year, all Advantedge loans will be moved over to NAB.
