STREAMING NOW: Watch Now

Australia's biggest bank hit with record fine for money-laundering scandal

Commonwealth Bank of Australia will pay the biggest corporate fine in the country's history for failings that allowed...

Posted: Jun 4, 2018 1:27 PM
Updated: Jun 4, 2018 1:27 PM

Commonwealth Bank of Australia will pay the biggest corporate fine in the country's history for failings that allowed drug gangs to launder money.

The record punishment for Australia's largest bank is the latest blow to the country's financial sector, which has been rocked by a series of scandals recently.

Austrac, a regulator that focuses on financial crime, said Monday that CBA would pay $700 million Australian dollars ($534 million) to settle a lawsuit after the bank admitted it failed to observe laws to prevent money laundering and financing of terrorism.

Between 2012 and 2015, CBA failed to report more than 53,000 suspicious transactions using its ATMs to authorities on time. Drug gangs laundered money by taking advantage of a loophole that allowed for large, anonymous deposits to CBA accounts, Austrac said.

"As we have seen in this case, criminals will exploit poor business practices to launder the proceeds of their crimes," Austrac CEO Nicole Rose said in a statement.

Related: One of Australia's top financial firms is in crisis

"This has real impacts on the everyday lives of Australians and puts the community at risk by increasing opportunities for terrorists to support attacks here and overseas, and enabling organized crime groups to peddle drugs to our families and friends," she added.

Austrac first began legal action against the bank 10 months ago. CBA's payment of the fine is dependent on the settlement being accepted by Australia's federal court.

"While not deliberate, we fully appreciate the seriousness of the mistakes we made," CBA CEO Matt Comyn said in a statement. "Our agreement today is a clear acknowledgment of our failures and is an important step towards moving the bank forward. I apologize to the community for letting them down."

CBA has blamed the failure to report suspicious transactions on time on a coding error in its computer systems.

Related: Australia's top bank says it charged dead clients for advice

It's the second blow in just over two months for the bank, whose shares are down about 13% so far this year.

In April, CBA admitted to charging fees to clients it knew had died years previously.

The bank told a Royal Commission inquiry that the practice of billing deceased customers for financial advice stretched back years. In one instance, an adviser at the bank's financial planning business was collecting fees from a client more than a decade after they had died.

A Royal Commission is Australia's highest form of public inquiry. It was ordered by Prime Minister Malcolm Turnbull at the end of last year in a bid to restore public confidence in the country's financial sector.

The commission is due to submit its findings to the government in February 2019.

West Lafayette
Overcast
43° wxIcon
Hi: 47° Lo: 35°
Feels Like: 43°
Kokomo
Overcast
43° wxIcon
Hi: 45° Lo: 34°
Feels Like: 39°
Rensselaer
Overcast
37° wxIcon
Hi: 41° Lo: 30°
Feels Like: 37°
Fowler
Overcast
37° wxIcon
Hi: 41° Lo: 32°
Feels Like: 37°
Williamsport
Overcast
41° wxIcon
Hi: 44° Lo: 34°
Feels Like: 41°
Crawfordsville
Overcast
45° wxIcon
Hi: 46° Lo: 36°
Feels Like: 42°
Frankfort
Overcast
45° wxIcon
Hi: 47° Lo: 35°
Feels Like: 42°
Delphi
Overcast
43° wxIcon
Hi: 45° Lo: 33°
Feels Like: 43°
Monticello
Overcast
41° wxIcon
Hi: 43° Lo: 32°
Feels Like: 41°
Logansport
Overcast
41° wxIcon
Hi: 45° Lo: 32°
Feels Like: 41°
Chilly and cloudy Tuesday
WLFI Radar
WLFI Temps
WLFI Planner

Indiana Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 164581

Reported Deaths: 4143
CountyConfirmedDeaths
Marion26055792
Lake14436358
St. Joseph9606168
Elkhart9271138
Allen8647231
Hamilton6400115
Vanderburgh617162
Tippecanoe396715
Porter347550
Hendricks3418134
Monroe335638
Johnson3286130
Delaware311575
Clark306263
Vigo275340
Madison250896
LaPorte239261
Cass229724
Warrick205065
Kosciusko201127
Floyd187468
Howard169466
Bartholomew147958
Marshall147428
Dubois146426
Wayne142031
Grant133539
Henry133030
Boone129150
Hancock124744
Noble122935
Jackson121018
Dearborn103128
Morgan100340
Lawrence96838
Gibson94412
Clinton92416
Daviess92334
Shelby90632
LaGrange82815
Knox81810
Harrison81024
Posey7767
Putnam77616
Fayette76719
DeKalb76011
Jasper6885
Miami6715
Steuben6608
Montgomery63122
White62316
Greene57838
Adams5607
Scott55413
Decatur52839
Ripley4838
Whitley4836
Clay4617
Sullivan45714
Wells45611
Huntington4455
Starke4438
Wabash4439
Orange42425
Spencer4176
Randolph39210
Jennings38713
Washington3873
Franklin38325
Fulton3785
Perry36914
Jefferson3655
Pike35718
Carroll34313
Jay3386
Fountain3293
Tipton28423
Vermillion2721
Parke2564
Rush2464
Blackford2394
Newton23711
Owen2151
Martin2050
Pulaski1783
Crawford1631
Brown1473
Ohio1337
Union1140
Benton1130
Switzerland980
Warren911
Unassigned0236

COVID-19 Important links and resources

As the spread of COVID-19, or as it's more commonly known as the coronavirus continues, this page will serve as your one-stop for the resources you need to stay informed and to keep you and your family safe. CLICK HERE

Closings related to the prevention of the COVID-19 can be found on our Closings page.

Community Events