National Australia Bank to compensate customer for losses caused by investment scam
The Australian Financial Complaints Authority (AFCA) recently handed down a Determination in the favour of a scam victim requiring the NAB to compensate their client $250,000 for failing to make further enquiries to identify if their client was being scammed.
The Australian Financial Complaints Authority (AFCA) recently handed down a Determination in the favour of a scam victim requiring the NAB to compensate their client $250,000 for failing to make further enquiries to identify if their client was being scammed.
The background to the complaint was that the NAB client had been contacted by an investment company who purported to be a legitimate investment broker. The client made initial investments with the scammers and contacted the Bank on 5 October 2020 to notify of the initial investments so that the transfers were not flagged by the bank’s system. During a second telephone call with the Bank on 6 November 2020 the client discussed the circumstances of the investments with a bank representative. During this conversation the Bank’s representative spoke to the client about whether they were sure the investment company was legitimate or a scam. After receiving the explanation from the client the Bank’s representative told them that “then it should be fine” and that “you can trust them”. After this conversation the client transferred a further $500,000 to the scammers. All the amounts were lost.
AFCA held that the representations made by the Bank misled the client to believe they could trust the scammers which led to the client making the further investments. AFCA found that the Bank was 50% liable for the losses suffered but that the client should also bear some responsibility. The NAB was required to compensate the client $250,000 which represented 50% of the losses suffered after 6 November 2020.
This Determination is another example of Banks being held responsible for scam losses. Importantly the Bank’s representative was on notice that the client was inexperienced in investing and should have done more to protect their client. FD Legal supports AFCA in making this Determination and helping scam victims recover losses.
If you have been the victim of a scam and require assistance bring an AFCA complaint contact FDL. We are experienced in helping scam victims recover compensation against Banks. You can contact us online, call us on 1800 433 533 or email us at enquiry@fdlegal.com.au
