The National Australia Bank could be the subject of a massive new class action, after the Federal Court reportedly ruled that some 400,000 of its customers are eligible to claim against allegedly dodgy sales practices by the bank.
Slater and Gordon Lawyers issued a statement on Friday morning (9 August) stating that the Federal Court had ruled almost half a million of NAB’s customers would be eligible to participate in the class action.
The law firm is representing NAB customers, who it claims were “sold junk credit card and personal loan insurance that was of little or no value, and that many customers would never have been eligible to claim against”.
It comes on the back of the banking royal commissions and allegations that NAB had engaged in misleading, deceptive and even unconscionable conduct.
According to Slater and Gordon’s practice group leader, Andrew Paull, this is one of the largest notices ever issued by an Australian court.
“NAB will have to contact over 400,000 of the customers on their databases today, informing them that this class action exists, that the bank is accused of contravening the law and telling them what they have to do to be involved,” he said.
“If you are — or have been — a NAB customer in the past, keep an eye out for this letter which will advise you of how to register your interest in participating in the class action.”
Mr Paull said that despite knowing that aggressive sales tactics and “pressuring vulnerable customers into buying worthless insurance” was wrong, the bank “did it anyway”.
“And [it] collected millions of dollars in unwarranted premiums in the process.”
According to Mr Paull, NAB customers will be given the ability to opt out of the class action, which he said is being operated on a no-win, no-fee basis.
A NAB spokesperson subsequently issued the following statement on the matter to My Business sister publication Mortgage Business, noting that the bank did not want to go into details while the matter is before the court:
“Notices relating to the class action proceedings commenced by Slater & Gordon against National Australia Bank (NAB) and MLC Ltd (MLCL) have been distributed to potential class members as part of the court process,” the statement said.
“The notices provide those potential class members with information about the class action and their options.
“We are here for our customers and encourage them to contact NAB directly if they have any questions in relation to their CCI policies on 1300 168 909
“As the matter is now before the Court, we are unable to comment further on the class action.”
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.