NAB Wealth, the wealth management business of National Australia Bank, has decided to pay A$25m ($18.38m) to nearly 62,000 clients affected by error in its Navigator Wrap wealth management platform.
The problems dated back to 2001 and affected clients when they were closing accounts.
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The compensation follows an independent review by PricewaterhouseCoopers at the request of the Australian Securities & Investments Commission (ASIC).
The review identified errors in the way income and tax was allocated on the platform, which led to customers receiving less than they should have.
NAB Wealth expects to pay each customer A$400, including interest. But half of them will receive less than A$100, the bank said.
Group executive, NAB Wealth and chief executive of MLC, Andrew Hagger said NAB would write to customers and advisers over the coming weeks to explain this legacy issue and what NAB has done to fix the problem.
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By GlobalDataAndrew Hagger, group executive of NAB Wealth, in a statement said: "NAB Wealth has applied significant focus to our breach identification and reporting processes, which is what led to NAB originally reporting this legacy issue to ASIC.
"Our teams have worked extensively, with oversight by PwC and ASIC, to ensure the right processes, systems and controls are now in place.
"These errors are in no way related to the quality of NAB Wealth’s advice to its customers."
ASIC commissioner Greg Tanzer said: "ASIC expects banks to vigilantly monitor their platforms for issues such as this. Any issues identified should be swiftly and pro-actively reported to ASIC, with a view to promptly compensating customers."
