The National Australia Bank has told investors it takes legal action over the fees-for-no-service scandal seriously, after the corporate regulator took the bank to court for allegedly breaching corporate laws more than 12,000 times.

Key points: NAB could face several billion dollars in civil penalties if ASIC wins its case alleging more than 10,000 breaches of corporate laws

NAB could face several billion dollars in civil penalties if ASIC wins its case alleging more than 10,000 breaches of corporate laws The alleged breaches relate to the fees-for-no-service scandal, where NAB collected more than $650m in fees but did not provide financial advice

The alleged breaches relate to the fees-for-no-service scandal, where NAB collected more than $650m in fees but did not provide financial advice NAB's new CEO and chairman fronted their first annual general meeting since taking charge at the bank

The Australian Securities and Investments Commission (ASIC) has accused the bank of breaking the ASIC Act and the Corporations Act by charging customers for financial advice they did not receive and allegedly making false or misleading statements in fee disclosure statements from December 2013 to February 2019, when the final report of the banking royal commission was released.

NAB is also accused of contravening its financial services licence.

The bank collected more than $650 million in fees from customers but did not give them financial advice.

In his first annual general meeting as NAB chief executive, Ross McEwan told investors the bank would work cooperatively with ASIC to deal with the issue.

"I will make every effort to ensure our relationships with regulators are transparent and constructive," he said.

"An example of this is the civil legal action taken this week by ASIC against NAB in relation to alleged breaches concerning ongoing fee arrangements with clients of NAB Financial Planning."

ASIC deputy chairman Daniel Crennan told AM the bank faced the potential for several billion dollars in civil penalties amid legal action over the fees-for-no-service scandal, however, if the case was settled, then the fine was expected to be less than that.

Mr Crennan said former chairman, Ken Henry, and former chief executive, Andrew Thorburn, could be called as witnesses if the case went to court.

"If large entities such as NAB engage in long-term systemic misconduct of this sort or any other sort, then they can expect to find themselves in court and this is an instance of a very large case relating to very large numbers of contraventions over a very significant period of time," he said.

"It has been quite a comprehensive and reasonably long investigation and that relates to the number of contraventions that we investigated, the period of time over which those contraventions took place.

"So this issuing the proceeding is the culmination of that very comprehensive work."

NAB facing compensation bill of more than $2 billion

Mr Henry and Mr Thorburn were forced to fall on their swords after they were heavily criticised by banking royal commissioner, Kenneth Hayne, over the bank's handling of various scandals, including fees for no service.

Former senior NAB executive Andrew Haggar, who oversaw the wealth division, also left the bank after he was criticised for withholding critical information from regulators about the fees-for-no-service scandal.

Mr Haggar is singled out in ASIC's legal statement of claim for his involvement in the conduct, but the allegations are against NAB.

NAB so far faces a compensation bill of more than $2 billion for various financial scandals.

The bank's new chairman, Philip Chronican, told the meeting that, overall, the bank had so far returned $276 million to customers through just over 500,000 payments.

The bank said it had so far refunded nearly $37.8 million to 27,500 NAB clients for fees for no service, with compensation expected to be completed by June next year.

The bank said it began switching clients to 12-month advice contracts and stopped new ongoing fee arrangements.

NAB's 'failed capitalists' survive AGM

At last year's annual general meeting, NAB was hit with the biggest vote in corporate history against its remuneration report.

However, this year NAB investors voted overwhelmingly in favour of the bank's executive pay plans, with 97 per cent of votes cast in favour of the remuneration report after the bank scrapped short-term bonuses for executives, froze executive base pay and cut director fees by one-fifth.

Nonetheless, the fiery AGM went for about six hours, with investors slamming the bank for various financial scandals over nearly two decades.

NAB investor and former Labor senator Chris Schacht said the board and senior management had been incompetent over many years and should step down.

"It has not changed and that is the worrying thing about the bank," he told the meeting.

"Last year I said to the board, 'you are failed capitalists'. You are still failed capitalists because of the destruction of shareholder value.

"You have destroyed shareholder value to the tune of tens of tens of billions of dollars."

Other small investors at the AGM told The World Today they were very angry about the latest allegations.

"I think they'll send us bankrupt. Daylight robbery," one said.

"Where is the time to say enough is enough and we've got to stop the bastards."

Latest in a series of bank scandals

Last week Westpac became the first major bank to see investors vote against the executive pay plan for the second year in a row, but it survived an attempt to spill the board.

On Tuesday, the banking regulator announced it was investigating Westpac amid allegations by financial crimes agency, AUSTRAC, that the bank breached anti-money laundering laws more than 23 million times.

ASIC has also taken NAB to court over its introducer scheme, which saw third parties, including gym owners and tailors, paid commissions for introducing home loan customers to the bank.

AUSTRAC is also investigating NAB in relation to its compliance with anti-money laundering laws, with Mr Chronican telling the AGM the bank was acutely aware of the money laundering risks but "there will be times where our processes fall short".

The Commonwealth Bank was also recently fined after pleading guilty to 87 criminal charges of cold calling customers to sell insurance products.

It was also fined $700 million by AUSTRAC after breaking anti-money laundering and counter terrorism financing laws.