"This is another regrettable case of mismanagement in the superannuation sector," lawyer says
Maurice Blackburn has filed a class action against National Australia Bank, alleging that the financial giant breached its duties as a superannuation trustee and “ripped off” as many as 330,000 customers.
The class action filed last week in the Victoria Supreme Court against MLC Nominees and NULIS Nominees, two NAB group entities, alleges that MLC and NULIS failed to exercise the degree of care, skill and diligence required of a prudent superannuation trustee. The two entities also failed to perform their duties and exercise their powers in the best interest of beneficiaries, as well as failed to give priority to the interests of beneficiaries where a conflict of interest arose, Maurice Blackburn said.
MLC Nominees was the trustee of The Universal Super Scheme, which merged with others to become the MLC Super Fund in July 2016. NULIS was trustee of that super fund.
Andrew Watson, national head of class actions at Maurice Blackburn, said that the case focuses on NAB’s failure to transition in a timely way and in the best interest of super members more than $6.3bn of accrued default amounts (ADAs) into the lower-cost MySuper product. As a result, members of the default MasterKey super paid higher fees and commissions and received lower returns when they could have had better, Watson said.
“This is another regrettable case of mismanagement in the superannuation sector. The whole point of the MySuper reforms was to make sure that millions of everyday Australians who hadn’t made an active decision about their super were not losing money on higher fees and unnecessary or unused services,” he said. “MySuper was introduced to protect the retirement outcomes of Australians. MLC Nominees and NULIS’s job was to move default member balances into MySuper at the time that best met their members’ needs, not the needs of NAB or financial advisers.”
During the Financial Services Royal Commission, NAB was slammed for several breaches of super laws. Commissioner Kenneth Hayne referred the financial giant’s conduct regarding the transfer of ADAs to MySuper to the Australian Prudential Regulation Authority for possible criminal or civil proceedings.
“[NAB] acknowledged that one of the consequences of the delay was that members paid higher fees for longer than they would have had their ADAs been transferred earlier. For some members, this was not merely a risk, but a certainty. Advisers, including advisers within the NAB Group, stood to benefit from this to the financial detriment of those members,” Hayne said.