Save
Ouch: Major bank cops $700m penalty
Australia’s largest bank has agreed to pay the largest-ever civil penalty in Australian corporate history, after it was revealed to have breached anti-money laundering law 53,750 times.
Ouch: Major bank cops $700m penalty
Australia’s largest bank has agreed to pay the largest-ever civil penalty in Australian corporate history, after it was revealed to have breached anti-money laundering law 53,750 times.
The Commonwealth Bank announced this morning that it has entered into an agreement with the Australian financial intelligence agency, AUSTRAC.
The bank agreed to pay a $700 million civil penalty and AUSTRAC’s $2.5 million legal fees and has admitted to 53,750 contraventions of the Anti-Money Laundering/Counter-Terrorism Financing (AML/CTF) Act.
The decision remains subject to court approval, but the proceedings against the bank are otherwise dismissed.
The penalty is the largest in Australian corporate history and, according to CBA CEO Matt Comyn, reflects the “seriousness of the mistakes we made”.
Speaking this morning, he said, “This agreement, while it still needs to be approved by the Federal Court, brings certainty to one of the most significant issues we have faced.
“While not deliberate, we fully appreciate the seriousness of the mistakes we made. Our agreement today is a clear acknowledgement of our failures and is an important step towards moving the bank forward. On behalf of Commonwealth Bank, I apologise to the community for letting them down.
“Banks have a critical role to play in combating financial crime and protecting the integrity of the financial system. In reaching this position, we have also agreed with AUSTRAC that we will work closely together based on an open and constructive approach.”
The bank provided for a $375 million estimated penalty in December last year but said it will recognise the $700 million penalty – nearly double the estimated sum – in its financial statements for the year ending 30 June 2018.
However, if the bank was fined the maximum amount for each alleged breach, the penalty would have been closer to $966 billion.
AUSTRAC CEO Nicole Rose said the outcome should send a message that non-compliance with AML/CTF obligations will not be tolerated, noting that criminals will take advantage of lax security and compliance to launder proceeds.
“This has real impacts on the everyday lives of Australians and puts the community at risk by increasing opportunities for terrorists to support attacks here and overseas, and enabling organised crime groups to peddle drugs to our families and friends,” she said.
“We know that businesses are the first line of defence in protecting the community and our financial system from criminal abuse, and it is critical for AML/CTF compliance and risk management to be embedded in business strategy and practices.”
What brought them to this?
AUSTRAC accused CBA of AML/CTF failures in August last year after it failed to report a number of suspicious transactions. According to AUSTRAC at the time, CBA also failed to monitor its customers to manage the risk
In the months that followed, CBA was hit with a class action prepared by Maurice Blackburn Lawyers, further allegations of money laundering breaches and the departure of a number of key staff, including former CEO Ian Narev.
Savings account
More than half of Aussie Millennials don’t have a savings plan
Money is remaining a taboo subject for Millennials, which is leading to poor saving habits, a big four bank has revealed. ...Read more
Savings account
COVID-19 sees Aussies reach record-high wealth
New stats have revealed that Aussies are now richer than ever, having stashed away their cash during a year marred by the COVID-19 pandemic and the resulting economic shutdown. ...Read more
Savings account
Saving more during the pandemic? Here’s where that money should go
If you’re finding that you’re saving more during the pandemic, you’re not alone. ...Read more
Savings account
Aussie savings goals put on hold due to COVID-19 pandemic
The COVID-19 pandemic has seen Australians being forced to dip into their life savings, which is impacting their ability to achieve financial goals, new research has found. ...Read more
Savings account
The 4 types of COVID-19 consumers: Which one are you?
Australians are still living in fear of worsening economic conditions, with a study revealing changed spending behaviours across the board despite varying levels of individual financial impact. ...Read more
Savings account
Are you a victim of financial abuse? 22 questions to consider
An “invisible” form of abuse, family violence that uses money as a method of control and coercion, is a real issue in Australia. ...Read more
Savings account
Another $750 payment on way for pensioners
From today, the second cash payment that has formed part of the Australian government’s economic response to the coronavirus will be made available. ...Read more
Savings account
Big 4 bank busts out 3 per cent savings interest rate
But not everyone is eligible for the new rate, which is far beyond anything else on offer from an Australian bank. Are you? ...Read more
The Olympic effect on property and equity investors; COVID-19 Disaster Payments and super
Listen now
Do lockdowns boost property prices? Are short-sellers levelling the playing field? Did you lodge your tax returns early?
Listen now
Will lockdowns halt the housing boom? Is the metaverse taking over? And the cons of lodging your tax returns early
Listen now
Are you being priced out of the market? Have you got the Tuesday blues? And are you ready for the upcoming super changes?
Listen now
Savings account
More than half of Aussie Millennials don’t have a savings plan
Money is remaining a taboo subject for Millennials, which is leading to poor saving habits, a big four bank has revealed. ...Read more
Savings account
COVID-19 sees Aussies reach record-high wealth
New stats have revealed that Aussies are now richer than ever, having stashed away their cash during a year marred by the COVID-19 pandemic and the resulting economic shutdown. ...Read more
Savings account
Saving more during the pandemic? Here’s where that money should go
If you’re finding that you’re saving more during the pandemic, you’re not alone. ...Read more
Savings account
Aussie savings goals put on hold due to COVID-19 pandemic
The COVID-19 pandemic has seen Australians being forced to dip into their life savings, which is impacting their ability to achieve financial goals, new research has found. ...Read more
Savings account
The 4 types of COVID-19 consumers: Which one are you?
Australians are still living in fear of worsening economic conditions, with a study revealing changed spending behaviours across the board despite varying levels of individual financial impact. ...Read more
Savings account
Are you a victim of financial abuse? 22 questions to consider
An “invisible” form of abuse, family violence that uses money as a method of control and coercion, is a real issue in Australia. ...Read more
Savings account
Another $750 payment on way for pensioners
From today, the second cash payment that has formed part of the Australian government’s economic response to the coronavirus will be made available. ...Read more
Savings account
Big 4 bank busts out 3 per cent savings interest rate
But not everyone is eligible for the new rate, which is far beyond anything else on offer from an Australian bank. Are you? ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
