Half a dozen NAB branch managers in western Sydney were part of a gang gaming National Australia Bank's home loan "Introducer program" and they were the chief sponsors of widespread and long running mortgage fraud, the Hayne Royal Commission into banking misconduct heard yesterday.In an afternoon of devastating evidence, Anthony Waldron, the bank's executive general manager for broker partnerships, conceded that within the bank's "western Sydney local area market" a network of conflicted staff systemically abused their position for personal gain.Rowena Orr, the counsel assisting, summarised the arrangement in terms first notified to the bank by an unidentified whistleblower - the second one to come forward with similar allegations - back in 2015."The local area market; [staff were] taking bribes and the like. That person reported there were 11 people involved, six of them branch managers," Orr put to Waldron."A particular person was running the whole syndicate. A number of other people were all involved and all worked for another person whose name has been redacted …. there are five branches?""Yes", Waldron said, given Orr's questions all flowed from his own witness statement for the commission.Some of the mischief NAB dug up on its own initiative, via assurance reviews, although one problematic branch required a sequence of these reviews before management cottoned on the extent of the misconduct.There were "a number of fraud issues from that particular [unnamed] branch," Waldron told Hayne."That branch manager was trying to avoid popping up on reviews and reports, to avoid the controls that were in place. This is a good example of the individual committing fraud … as well as using falsified information and receiving payment, not only through the [incentive] process, but also in potential collusion with the introducer."Orr did most of the talking on the detail of the gory highlights of affair."The whistleblower tells NAB that these people are making up fake payslips, fake ID, fake Medicare cards," she put to Waldron."And the person has seen a little bit of evidence and has also heard from others in the local area market, one of them a branch manager at a different store not involved in the syndicate. "They charge $2800 bribery for each customer for home loans mainly, but also personal loans …. People are being promoted on the basis of home loans and other lending, so they appear they are smashing their targets, but some of it's false."Waldron accepted all this. Orr then continued:"The whistleblower is recorded as saying: 'One customer recently said at a particular branch, they told him he could borrow $800,000, but the valuation was only $450,000'. The whistleblower said 'the money exchanges hands in cash, in envelopes, white envelopes usually over the counter. Money is deposited at CBA, so NAB can't detect the deposits. [This is] happening on a daily or weekly basis and has been happening for a number of years.'""That's correct," Waldron agreed.Waldron will continue his evidence this morning, with executives from The Home Loan Broker and Commonwealth Bank to follow.