Westpac Proven Guilty of Breaching Money Laundering Laws after Commonwealth Bank

  • Richard Marley
  • September 24, 2020
  • 2 minutes read
  • 101

Westpac was accused of violating the money laundering laws and counter-terrorism financial allegations in November 2019. 

The bank has reached an agreement with the Australian Transaction Reports and Analysis Centre (Austrac) to settle the allegations. Now, the bank has to pay AU$1.3 million under the AML/CTF Act 2006 for violating anti-money laundering laws of the state at least 23 million times. 

The bank accepts breach of the laws and further mentions its failure to report international funds transfer of approximately AU$11 billion. How did Westpac fall into the money laundering swamp anyway? 

One of the bank’s reports about this case states that there was a combination of human and machine error and deficient financial crime procedures that led to the failure. The bank says there are three reasons behind their failure in AML compliance. 

  1. Some aspects of risk were misunderstood within the bank
  2. Unclear answers for managing the compliance
  3. Insufficient resources and skills 

If approved, this penalty will be the largest civil penalty in the Australian history and double of what Commonwealth bank paid in 2018.

Check out the challenges and fundamentals of AML compliance at Implementation of AML compliance – Challenges and fundamentals