ASIC has announced that NAB has paid a $10,200 penalty for misleading statements in a product disclosure statement (PDS).

ASIC issued an infringement notice to NAB for making potentially misleading statements in a PDS for the NAB Annuity Term Deposit.

Misleading statements often occur when a disclosure document or advertisements do not reflect the product specifications.

In this case, the PDS dated 17 June 2013 contained statements about the investment return on the NAB Annuity Term Deposit.

ASIC was concerned the statements may have misled consumers by representing that the interest rate, known in the PDS as the ‘Fixed Interest Rate’, was calculated on the entire principal amount invested. In reality, the rate only applied to the balance of the principal which reduced throughout the term of the investment.

NAB has issued a new PDS and promotional materials.