AUSTRAC chief executive Nicole Rose said the bank failed to report more than 19.5 million international fund transfers amounting to more than $11 billion over nearly five years.
“Westpac failed to pass on information about the origin of international funds transfers and keep records as required,” she told reporters in Canberra on Wednesday.
Rose said Westpac also failed to do customer due diligence on high-risk transactions to the Philippines and Southeast Asia with potential child exploitation risks.
“AUSTRAC alleges that Westpac’s oversight of its corresponding banking services was deficient, and that its oversight of its anti-money laundering and counter-terrorism financing program was also deficient.”
She said the failures resulted in serious and systemic breaches of anti-money laundering and counter-terrorism financing laws, which were allegedly broken 23 million times.
“This resulted in a significant loss of intelligence to AUSTRAC and our national security and law enforcement partners,” Rose said.
Any penalties will be decided in court, with civil proceedings now underway.
Rose said business were the first line of defence to protect the financial system from criminal abuse.
“This is an important reminder to all financial services businesses to be vigilant about money-laundering and counter-terrorism financing risks and understand their obligations,” she said.
Westpac says it self-reported the failure to report a large number of international funds transfer instructions to AUSTRAC.
“AUSTRAC was also investigating a number of other areas relating to Westpac’s processes, procedures and oversight,” the company said in a statement.
“Westpac is currently reviewing AUSTRAC’s statement of claim and will issue a further statement to the ASX once it has been assessed.”
National Australia Bank last week admitted it faces a huge fine for multiple possible breaches of counter terrorism and anti-money laundering laws.
Commonwealth Bank was fined a record $700 million in 2018 for serious breaches of the same laws.
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