NAB hit with A$20m damages claim from former tech chief

NAB hit with A$20m damages claim from former tech chief

National Australia Bank (NAB) has been hit with a A$20 million damages claim from its former chief information officer Ian Crouch who has accused the bank of "misleading or deceptive conduct" in terminating his employment contract in 2004.

Crouch quit his £1 million London-based role with consultancy AT Kearney to join NAB as CIO in 2002. He was in charge of the bank's IT projects until he was dismissed in mid-2004.

He reportedly agreed to accept lower pay at NAB in return for a long-term tenure - of at least three years.

Crouch's claim, which has been filed in the Federal Court of Australia, accuses the bank of breaches of the Trade Practices Act and Fair Trading Act. He alleges that NAB had been deceptive when terminating his contract in 2004, which occurred after the resignation of former NAB Frank Cicutto.

Crounch alleges that when he was recruited in 2002, he was wrongly informed by Cicutto that the problems associated with NAB's Florida-based mortgage processor HomeSide - where the bank was forced to write-off A$3.05 billion as the result of a computer error that went undetected for two years - had been dealt with and resolved.

But instead the HomeSide issue continued to dog the bank and contributed to Cicutto's resignation in February 2004. He was replaced at the head of the bank by John Stewart, who kicked off a overhaul of NAB executives.

According to press reports, Crouch's statement of claim says that he was not given a reason for his dismissal by Stewart in August 2004 but was was told it had nothing to do with his performance. It is also claimed that Stewart had never conducted any reviews of Crouch's performance.

The A$20 million damages claim is thought to be based on how much Crouch might have earned if he had stayed on at his previous job at AT Kearney.

A NAB spokesperson has told reporters that the bank believed its actions in relation to Crouch were "entirely appropriate" and that it would be "vigorously defending the claim".

Comments: (0)