The Federal Court has today approved an agreement between Commonwealth Bank of Australia (CBA) and AUSTRAC, resolving the civil proceedings commenced by AUSTRAC in August 2017.
With the Federal Court’s approval, this has become the largest ever civil penalty in Australian corporate history.
CBA will “recognise a $700 million expense in its financial statements for the full year ending 30 June 2018, which will be released on 8 August 2018”, according to a statement released today.
Earlier in June, AUSTRAC stated that CBA had accepted that:
- “It failed to carry out an appropriate assessment of the money laundering and terrorism financing (ML/TF) risks of its IDMs[intelligent deposit machines] prior to October 2017;
- It failed to complete the introduction of appropriate controls to mitigate and manage the ML/TF risks of IDMs prior to April 2018;
- It failed to provide 53,506 threshold transaction reports to AUSTRAC on time for cash transactions of $10,000 or more through IDMs from November 2012 to September 2015, having a total value of about $625 million;
- For a period of three years, it did not comply with the requirements of its AML/CTF program relating to monitoring transactions on 778,370 accounts;
- It failed to report suspicious matters on time, or at all, involving transactions in the tens of millions of dollars; and
- Even after it became aware of suspected money laundering or structuring on CBA accounts, it did not monitor its customers to mitigate and manage ML/TF risk, including the ongoing ML/TF risks of doing business with those customers.”
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