3 Aug 2017

Aus bank accused of breaking money-laundering laws

9:13 pm on 3 August 2017

An Australian bank has been accused of breaching anti-money laundering and terrorism financing laws.

Civil action has been launched in the Federal Court by the country's financial intelligence authority alleging the bank failed to comply with laws on 53,700 occasions.

Australian Transactions Reports and Analysis Centre acting chief executive Peter Clark said the civil proceedings should send a clear message to the sector about the importance of complying with anti-money laundering and terror financing laws.

Allegations of ''serious and systemic'' breaches relate to the bank's use of intelligent deposit machines (IDM), which accept deposits by cash and cheque and automatically count and credit monies to domestic and international accounts.

The Commonwealth Bank potentially faces a civil fine up to $A18 million for the alleged breaches between November 2012 and September 2015.

IDMs can accept up to 200 notes per transaction, or up to $20,000 per cash transaction, with no daily limit on the number of transactions.

Anti-money laundering laws in Australia require the reporting of transactions with a threshold of $10,000 or more to the financial watchdog.

The bank is accused of failing to report threshold transactions in time to the financial intelligence authority and failing to take steps to assess the risk of laundering or terrorism financing in the three years after IDMs were introduced.

The intelligence agency alleged the bank failed to comply with the law relating to the monitoring of transactions for more than 770,000 accounts and failed to give more than 53,000 threshold reports on time.

By doing so, the bank failed to report suspicious deposits on time, or at all, for more then $624m in transactions, the agency claims.

In May and June 2016, more than $1bn per month was deposited in cash via the bank's IDMs.

The Commonwealth Bank is the parent company of ASB in New Zealand.

A spokesperson at ASB said the allegations did not relate to ASB and New Zealand laws differed to Australian anti-money laundering laws.


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