MONEY LAUNDERING – LAW AND LEGISLATION – AUSTRALIA

Westpac papers reveal trail of human, IT failure

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Original article by Aaron Patrick
The Australian Financial Review – Page: 1 & 4 : 28-Nov-19

Westpac’s confidential disclosures to Austrac show that it breached anti-money laundering and counter-terrorism financing laws some 29 million times. Austrac has accused the major bank of 23 million breaches, and the additional breaches cannot be prosecuted as they fall outside the statute of limitations. The documents also show that international money transfers with seven global banks had not been reported since 2011, due to problems with a computer system upgrade that began in 2010. However, Westpac did not become aware of the problem until May 2017, and it was not reported to Austrac until August 2018.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE

Westpac’s Austrac scandal differs from other institutions

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Original article by Robert Gottliebsen
The Australian – Page: 29 : 26-Nov-19

Westpac’s scandal is completely different to scandals that cost the jobs of top executives at the Commonwealth Bank, National Australia Bank and AMP in recent years. Westpac chairman Lindsay Maxsted says that the board had no prior warning of Austrac’s legal action or the specific nature of its allegations. However, Austrac alleges that Westpac was aware of concerns about payments linked to child exploitation as far back as 2013. The question arises as to whether CEO Brian Hartzer was aware of these concerns and withheld this from the board.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AMP LIMITED – ASX AMP

Investors demand action by Westpac

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Original article by Joyce Moullakis
The Australian – Page: 17 & 21 : 26-Nov-19

Nathan Parkin of Ethical Partners Funds Management contends that some at a high level at Westpac needs to be held accountable for the financial penalties that will arise from its massive breach of anti-money laundering laws. Meanwhile, one of Westpac’s 20 largest shareholders believes that CEO Brian Hartzer will not be to able to remain at the helm in the wake of the scandal. Westpac’s share price has fallen by 8.8 per cent since the scandal was revealed.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, ETHICAL PARTNERS FUNDS MANAGEMENT PTY LTD, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, PLATO INVESTMENT MANAGEMENT LIMITED, OWNERSHIP MATTERS PTY LTD, AUSTRALIAN COUNCIL OF SUPERANNUATION INVESTORS INCORPORATED, INSTITUTIONAL SHAREHOLDER SERVICES INCORPORATED, NORGES BANK INVESTMENT MANAGEMENT, BLACKROCK INCORPORATED, THE VANGUARD GROUP INCORPORATED

Stay calm, this is no Enron

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Original article by Peter Van Onselen, Michael Roddan
The Australian – Page: 1 & 2 : 26-Nov-19

Westpac CEO Brian Hartzer has told his executive team that there is no need to "overcook" the money-laundering and child exploitation scandal that has embroiled the bank. He has argued that it is not a major issue for "people in mainstream Australia". Sources have also indicated that Hartzer has told executives to focus on issues such as lifting Westpac’s net promoter score and writing more home loans. He is also said to have downplayed any comparisons to Enron and Lehman Brothers.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. DEPT OF HOME AFFAIRS, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, MOODY’S INVESTORS SERVICE INCORPORATED, VICTORIA. DEPT OF TREASURY AND FINANCE

Westpac execs still in the money

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Original article by Richard Gluyas, Joe Kelly
The Australian – Page: 1 & 2 : 25-Nov-19

Treasurer Josh Frydenberg has stressed the need for accountability over Westpac’s massive breach of anti-money laundering and counter-terrorism financing laws. He notes that in addition to Austrac’s civil prosecution, there is the potential for Westpac executives and directors to be disqualified under the Banking Executive Accountability Regime. Meanwhile, Westpac chairman Lindsay Maxsted says executives’ short-term bonuses will be frozen; however, their long-term bonuses are not expected to be affected. Other measures taken by Westpac in response to the scandal include shutting down the LitePay international fund transfer network.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. DEPT OF THE TREASURY, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Porter flags big Westpac penalty

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Original article by James Eyers, Michael Pelly
The Australian Financial Review – Page: 1 & 6 : 22-Nov-19

Attorney-General Christian Porter says he will keep a "watching brief" on the prosecution of Westpac for breaching anti-money laundering laws. He has also warned that Westpac is likely to incur a much bigger financial penalty than the Commonwealth Bank’s record $700m fine for far less serious breaches. Meanwhile, the Australian Prudential Regulation Authority will look into the potential application of the federal government’s Bank Executive Accountability Regime to the Westpac case, while ASIC may investigate whether the bank has breached the Corporations Act.

CORPORATES
AUSTRALIA. ATTORNEY-GENERAL’S DEPT, WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, MACQUARIE UNIVERSITY

Westpac must start hunt for a new CEO

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Original article by Terry McCrann
Herald Sun – Page: 35 : 21-Nov-19

It is inevitable that Westpac CEO Brian Hartzer will have to step down in the wake of the banking sector’s latest money laundering scandal. This will leave ANZ’s Shayne Elliott as the only CEO of a big four bank who was appointed prior to the Hayne royal commission. The only issue for Westpac’s board is whether to opt for an internal or external successor. Meanwhile, questions need to be asked about the failure of Austrac to ensure that Westpac and the Commonwealth Bank were complying with anti-money laundering laws.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION, AUSTRALIA. ROYAL COMMISSION INTO MISCONDUCT IN THE BANKING, SUPERANNUATION AND FINANCIAL SERVICES INDUSTRY, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

$1bn scandal hits Westpac

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Original article by Joyce Moullakis, Greg Brown
The Australian – Page: 1 & 8 : 21-Nov-19

Prime Minister Scott Morrison says banks must "lift their game" in the wake of revelations that Westpac has been charged with more 23 million breaches of anti-money laundering and counter-terrorism financing laws. Amongst other things, Austrac’s statement of claim alleges that Westpac failed to conduct due diligence on 12 customers linked to child exploitation in the Philippines. Brett Le Mesurier of Shaw & Partners says Westpac may face a larger penalty than the Commonwealth Bank’s record $700m fine in 2018 for more than 53,000 breaches of financial crime laws. Westpac could potentially incur fines in excess of $1bn.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Law firm hits CBA with class action suit

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Original article by Cliona O’Dowd
The Australian – Page: 20 : 3-Jul-18

The Commonwealth Bank of Australia faces another class action over its money-laundering scandal. Law firm Phi Finney McDonald has filed a lawsuit on behalf of investors who bought CBA shares between 16 June 2014 and 3August 2017. The firm alleges that CBA’s failure to inform the market about the scandal constituted a breach of its disclosure requirements. The class action will allege that investors incurred loss and damage due to the bank’s inaction.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, PHI FINNEY McDONALD PTY LTD, THERIUM PTY LTD, CALIFORNIA STATE TEACHERS’ RETIREMENT SYSTEM, TEACHERS’ RETIREMENT SYSTEM OF TEXAS, MASSACHUSETTS PENSION RESERVES INVESTMENT MANAGEMENT BOARD, COLORADO PUBLIC EMPLOYEES’ RETIREMENT ASSOCIATION, MAURICE BLACKBURN PTY LTD, IMF BENTHAM LIMITED – ASX IMF

Formula behind CBA’s record $700m penalty revealed

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Original article by James Frost
The Australian Financial Review – Page: 17 : 7-Jun-18

Documents submitted to the Federal Court show that the Commonwealth Bank’s flawed rollout of its intelligent ATMs accounted for $A180m of the $A700m fine that it received for breaching anti-money-laundering and terrorism financing laws. The bank was also fined $A170m for failing to undertake sufficient due diligence on customers who were subsequently found to have been drug traffickers or terrorists. Other penalties included a $A125m fine for failing to provide Austrac with more than 55,000 threshold transaction reports in a timely manner.

CORPORATES
COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, AUSTRALIA. ATTORNEY-GENERAL’S DEPT. AUSTRALIAN TRANSACTION REPORTS AND ANALYSIS CENTRE, FEDERAL COURT OF AUSTRALIA, AUSTRALIAN FEDERAL POLICE, WESTERN AUSTRALIAN POLICE SERVICE, NEW SOUTH WALES POLICE FORCE