Westpac bank to pay record Australian fine over laundering breaches

2024-07-07 15:18:03

Australia's Westpac bank has negotiated to pay a record A$1.3bn (£0.7bn; $0.9bn) fine for the nation's biggest breaking of money laundering laws. Last year, Australia's financial crime watchdog said the bank had failed to appropriately report over 19 million international transactions.

Officials said some payments were potentially linked to child exploitation. The nation's second-biggest lender has apologized for its "failings".

Westpac is the second top Australian bank to pay huge fines for breaking anti-money laundering and counter-terrorism financing laws.

If the billion-dollar fine is approved by a court, it will be the largest civil penalty in Australian corporate history.

While the fine could have been larger. Austrac also said the transactions had amounted to 23 million law breaches, with each carrying a maximum penalty of A$21m.

Chief executive Peter King in a statement on Thursday, "We are committed to fixing the issues to ensure that these mistakes do not happen again."

Westpac self-reported the breaches to the Australian Transaction Reports and Analysis Centre (Austrac) last year. It also revealed the investigation to shareholders, including a forecast penalty.

The bank said on Thursday it had reached an agreement to settle the court case waged by Austrac.

Most of the breaches concerned the bank's failure to report international transfers to the regulator, as required by law, in a timely fashion.

It said the bank also failed to retain records and carry out due diligence checks with potentially high-risk overseas banks.

Austrac said there were also a small number of payments on accounts that were potentially linked to "child exploitation risks".

The cases come amid several investigations around the world into top banks for their alleged failures to prevent money laundering.

HSBC, Danske Bank, and Rabobank have all been involved in high-profile scandals.

In Australia, Westpac's competitor Commonwealth Bank paid an A$700m fine for similar breaches in 2018 involving 53,000 suspect transactions.

The nation's banking sector was last year also the subject of a royal commission - Australia's highest form of a public inquiry - that exposed widespread wrongdoing in the industry.

Monika Walker

Monika Walker is an experienced journalist specializing in global political developments and international relations. With a keen eye for accuracy and analysis, Monika has been reporting for over a decade, bringing stories to light that matter to readers around the world. She holds a degree in International Journalism and is passionate about giving a voice to underrepresented communities through factual reporting.