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CBA faces legal action for money laundering breaches

CBA faces legal action for money laundering breaches

Commonwealth Bank has been accused of more than 53,000 financial violations by Australia’s financial intelligence and regulatory agency.

AUSTRAC has initiated civil penalty proceedings in the Federal Court against Commonwealth Bank “for serious and systemic non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act)”.

AUSTRAC’s action alleges over 53,700 contraventions of the AML/CTF Act.

This follows an investigation by AUSTRAC into Commonwealth Bank’s compliance, particularly regarding its use of intelligent deposit machines.

According to AUSTRAC, Commonwealth Bank did not carry out any assessment of the money laundering and terrorism financing risk of these machines before their rollout in 2012.

This assessment allegedly did not start until mid-2015 – three years after the machines were introduced.

“For a period of three years, CBA did not comply with the requirements of its AML/CTF program relating to monitoring transactions on 778,370 accounts,” AUSTRAC said.

“We want to emphasise our commitment to work with AUSTRAC and law enforcement agencies to fight money laundering and counter terrorism financing.

“We would never deliberately undertake action that enables any form of crime.

“To that end, we scan billions of dollars of transactions daily, and report 4 million transactions a year to AUSTRAC. We are currently reviewing AUSTRAC’s claim and will file a statement of defence in this matter.”

The regulator also said that Commonwealth Bank failed to give 53,506 threshold transaction reports to AUSTRAC on time.

These were for cash transactions of $10,000 or more through intelligent deposit machines from November 2012 to September 2015.

AUSTRAC said these late threshold transaction reports had a total value of about $624.7 million.

They represented about 95 per cent of the threshold transactions that occurred through the bank’s intelligent deposit machines from November 2012 to September 2015.

AUSTRAC also accused Commonwealth Bank of failing to report suspicious matters either on time or at all involving transactions totalling over $77 million.

The regulator said that even after Commonwealth Bank became aware of suspected money laundering or structuring, it did not monitor its customers to mitigate and manage the risk of money laundering and terrorism financing.

Regulator sends a message

AUSTRAC’s acting chief executive, Peter Clark, said this legal action should send a clear message to all reporting entities about the importance of meeting AML/CTF obligations.

“By failing to have sound AML/CTF systems and controls in place, businesses are at risk of being misused for criminal purposes,” he said.

“AUSTRAC’s goal is to have a financial sector that is vigilant and capable of responding, including through innovation, to threats of criminal exploitation.”

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What are the features of home loans for expats from Westpac?

If you’re an Australian citizen living and working abroad, you can borrow to buy a property in Australia. With a Westpac non-resident home loan, you can borrow up to 80 per cent of the property value to purchase a property whilst living overseas. The minimum loan amount for these loans is $25,000, with a maximum loan term of 30 years.

The interest rates and other fees for Westpac non-resident home loans are the same as regular home loans offered to borrowers living in Australia. You’ll have to submit proof of income, six-month bank statements, an employment letter, and your last two payslips. You may also be required to submit a copy of your passport and visa that shows you’re allowed to live and work abroad.

Cash or mortgage – which is more suitable to buy an investment property?

Deciding whether to buy an investment property with cash or a mortgage is a matter or personal choice and will often depend on your financial situation. Using cash may seem logical if you have the money in reserve and it can allow you to later use the equity in your home. However, there may be other factors to think about, such as whether there are other debts to pay down and whether it will tie up all of your spare cash. Again, it’s a personal choice and may be worth seeking personal advice.

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The Early Repayment Adjustment (ERA) and Administrative fees are applicable in the following instances:

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Usually your settlement agent will meet the seller’s representatives to exchange documents at an agreed place and time. The balance purchase price is paid to the seller. The lender will register a mortgage against your title and give you the funds to purchase the new home.

Once the settlement process is complete, the lender allows you to draw down the loan. The loan amount is debited from your loan account. As soon as the settlement paperwork is sorted, you can collect the keys to your new home and work your way through the moving-in checklist.

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When calculating how much you need to save, don’t forget to factor in other expenses like stamp duty, insurance, legal fees, and moving costs.

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Your bank statements and/or your internet banking should show these details. If you are not sure, call your bank or estimate.

Can I get a Commonwealth Bank home loan during maternity leave?

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