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Election 2016: Labor steps up calls for banking royal commission as ASIC moves against NAB on rate rigging
By political reporter Anna Henderson
Updated
Tue 7 Jun 2016, 6:59pm
The corporate regulator is taking one of Australia's biggest banks to the Federal Court over allegations of interest rate rigging, prompting fresh pressure from the Federal Opposition for a royal commission into the banking sector.
Key points:
· NAB third major bank to face federal court action after ANZ, Westpac
· Allegations relate to "unconscionable conduct and market manipulation"
· Shorten says court action adds to evidence in favour of national inquiry
The Australian Securities and Investments Commission (ASIC) has confirmed it has begun legal proceedings against National Australia Bank (NAB) "for unconscionable conduct and market manipulation".
It is the third major bank to face federal court action over rate rigging. In March, the regulator moved on the ANZ and Westpac.
The allegations relate to NAB's involvement in setting the bank bill swap reference rate (BBSW) between June 2010 and December 2012.
NAB Group's chief risk officer David Gall said in a statement that the bank would fight the claims.
"NAB has fully cooperated with ASIC's review and takes these allegations seriously. We do not agree with ASIC's claims, which means they will now be settled by a court process," the statement read.
"As part of ASIC's investigation NAB has provided emails, instant chat messages and telephone conversations involving our employees."
Shorten renews push for royal commission
Opposition Leader Bill Shorten has been arguing for a royal commission into the banking sector, and said the latest court action added to the growing evidence in favour of the national inquiry.
"How many more people need to suffer and get ripped off before Mr Turnbull stops covering up for the banks?" he said in a statement.
"Rather than hold the big banks accountable, Mr Turnbull is gifting them a $7.4 billion tax hand out.
"It is an insult to everyone who's been ripped off.
"Mr Turnbull has a choice here, and he's putting the big banks first. He's governing for the banks, not the Australian people."
According to a statement released by ASIC, the regulator will argue the trades were intended to create an artificial price on 50 occasions during the period in question.
"ASIC alleges that on these days NAB had a large number of products, which were priced or valued off BBSW, and that it traded in the bank bill market with the intention of moving the BBSW higher or lower," the statement read.
"ASIC alleges that NAB was seeking to maximise its profit or minimise its loss to the detriment of those holding opposite positions to NAB's."