Yes?And the email that you put to me was absolutely consistent with what Mr Young just said. It was more junior people that had put that to me. It – but I don’t want to imply that that were not issue – that was not an issue that I also didn’t turn my mind to. MR All right. So, just so we make sure we understand, Ms Buchanan is, obviously, lower in the hierarchy than you?Yes. And, as I understand it, you say you weren’t the author of this attachment that Ms Buchanan has sent around?No. I think we looked at this yesterday, but do you recall having read the attachment?I can’t recall this particular attachment. All right. Commissioner, I think that was tendered yesterday, so that it’s not necessary to deal with it again. I’m told it’s exhibit 5.14. THE COMMISSIONER: Yes. Just on the question of tender, that email concerning the meeting of 2 June ’16 between NULIS and ASIC, ASIC.0516.0001.0167, do you propose that that be tendered? That was the one that you went to earlier this morning. MR HODGE: Yes, Commissioner. THE COMMISSIONER: That will be exhibit 5.19, email concerning meeting 2 June ’16 NULIS and ASIC, ASIC.0516.0001.0167. EXHIBIT #5.19 EMAIL CONCERNING MEETING 2 JUNE 2016 (ASIC.0516.0001.0167) MR HODGE: All right. Can we now bring up NAB.162.011.1706. So this is a chain of internal emails. But, again, I think we looked at it very briefly yesterday and I just want to make sure we put in context. So you can see at the bottom of the page an email from you to two people within NAB. Can you just tell the Commissioner again who they are?Lara Bourguignon and Stephen Sefton. But what are positions?Lara was the general manager of corporate superannuation at the time, I believe, and Stephen Sefton was in the group insurance business. All right. And did they each report to you?Lara reported directly to me. Stephen would have reported through to someone else who reported to me. All And, again, I think you agreed yesterday you said “having spoken to Nicole S”, that would be Nicole Smith?Yes.
And is it your understanding that that is one of the reasons why the bank has now agreed to refund the PSFs to all MKPS members?Yes. And so you know that the way in which this has been presented is that this was just a problem with disclosure?No. You don’t think so?No. Okay. You think that it has been presented as also a problem with whether or not the services were actually provided?I – so depending on who you think it is being presented to is The public. In the public statements that have been made you’ve given a statement about?I think we’ve made – yes, I have. I think it – the point of the public statement is not to go into the entirety of the rationale for why we’ve determined we have an error. It’s to – the point of that public disclosure was to ensure that our members were aware of information that was going into the hands of advisers so that they knew at the same time that an error had occurred, and that we would be refunding a particular category of members. There was a – I don’t – I wasn’t involved in the drafting of that. I don’t know how the words were chosen or why the words were chosen, but primarily the – the starting point for the PSF event actually was concern from ASIC with the disclosures that we had made. All right. Let me just show you another document, which is exhibit 5.12. It’s NAB.005.871.0022. You just need to look over on the screen. Have you seen that document before, Ms Smith?I don’t recall. I may have seen it as part of my witness statement preparation, but that would be the only time. I have reviewed All right? a lot of documents in the last few days, so I understand. And you see it’s a document titled Removing an Adviser/Turning off Commissions, MKBS /MKPS?Yes. And you see in item 3: What action will we take if a member requests us to turn off commissions or stop paying their plan adviser? ?Yes. And you see: When a member directly requests us to turn off commissions, we will perform the following. And the first thing is:
I see. You were very clear in your own mind as to what the problem was at the time that you were meeting with ASIC?TERP members. Yes. All right. Did you communicate to ASIC what you thought the problem was?We had discussions about how – that I felt it was an error. I think you will get the opportunity to look at this document overnight. Can I ask you about some other parts of it. Can you go to page 4 of the document?Yes. And you see what is paragraph 2.12(c), Compensation Methodology?Yes. Continuing: Compensation methodology. Are considering the right compensation methodology for these members. This methodology should appropriately reflect any potential legal liability position, which we are working through at the moment, and also be practical to implement. ?Yes. Can you recall what the legal liability issue was that you were working through?No. Can I suggest to you that it was the suggestion from the Wealth business that they retain the plan service fees even though there was no linked adviser, because there were other types of general advice available through, for example, MLC Direct?That was not put to me at this as this letter was being written, and nor formally put to me as a proposal for compensation for the plan service fee matter. All right. Can you recall alternatives being put to you as to the proposed remediation?No. You can only recall one possibility for remediation being ?That came to the board, yes. And did you know at the time you signed this letter what the issue was about potential legal liability of NULIS?No. Do you know whether the Office of the Trustee knew?At 22 July, no, I don’t. Was that something that when you signed this letter you were curious “Why are we not able to make compensation yet, because we’re trying to figure out a potential legal liability”?I don’t recall – I don’t recall questioning that paragraph at the time. And then, if we go down to section 3 at the bottom of the page, you see 3.1: