Specifically, the Australian Federal Court imposed a fine of AUD 2.1 million (USD 1.4 million) on National Australia Bank (NAB), the country's second-largest lender, for incorrectly levying periodic payment fees on customers. According to Reuters, between January 2017 and July 2018, NAB continued to charge its customers these periodic payment fees for fund transfers, even though they were not entitled to do so under their contracts. The Australian Securities & Investments Commission (ASIC) revealed this misconduct, stating that the bank wrongfully billed 2,888 personal banking customers and 513 business clients for payment fees amounting to AUD 139,845 on 74,593 occasions.
ASIC Deputy Chair Sarah Court emphasised the expectation that financial institutions, particularly banks, take swift action to minimize harm to consumers when their systems fail. In response, NAB acknowledged the erroneous charges in an email to Reuters, acknowledging that some customers had been incorrectly charged for periodic payment fees several years ago. The bank stated that it had conducted a remediation program and reimbursed over AUD 8.3 million to the affected customers.
Reuters reports that Australian regulators have fined numerous companies for breaches and non-compliance, with the 'Big Four' banks facing the most substantial penalties following a Royal Commission's investigation into the sector, which exposed widespread misconduct.
In July 2023, National Australia Bank blocked more than AUD 270 million in customer payments citing cryptocurrency scam concerns. NAB put a stop to an undisclosed number of transactions to crypto platforms that raised red flags between March 2023 and July 2023. However, the bank did not name any exchange in particular that was affected by these measures.
At the time, reports from the Australian Financial Crimes Exchange indicated that 50% of scams reported to the agency were linked to cryptocurrencies, and cryptocurrency platforms were being used by scammers to send stolen funds overseas.
In March 2023, National Australia Bank completed its first intra-bank cross-border transaction using its own stablecoin via Ethereum.
The transaction, which was part of a NAB pilot for an AUD-backed stablecoin, involved deploying stablecoin smart contracts for seven major global currencies, showcasing the potential to shorten cross-border transactions from days to minutes. NAB aims to issue its stablecoin under the ticker ‘AUDN,’ which will be managed as a liability on its books. The firm further plans to enable transactions for the Australian, New Zealand, Singapore, and US dollars, as well as the EUR, JPY, and GBP.
Every day we send out a free e-mail with the most important headlines of the last 24 hours.
Subscribe now