Westpac Braces for AUS$900 Million Penalty
Australian bank Westpac has said it is setting aside more
than AUS$900 million (US$570 million) to resolve allegations it facilitated
more than 23 million breaches of anti-money laundering and counter-terrorism
laws.
The bank announced the provisions on Tuesday, ahead of an
anticipated fine from the country’s financial regulator, the Australian
Transaction Reports and Analysis Centre (AUSTRAC).
Westpac has maintained that the breaches came about as the
result of a bug in the bank’s system. Some of the transactions processed are
believed to have been payments to known child sex offenders in South East Asia.
The bank added that it may also be required to carry
additional costs of up to AUS$130 million (US$82 million) related to
improvements to its financial crime response measures.
Westpac announced plans to tighten its controls on 25th
November last year, in addition to pledging further support for industry-wide
initiatives to enhance financial crime monitoring. It also said it would
provide resources to organisations working to eradicate child exploitation.
Newly appointed chief executive at the bank, Peter King,
reportedly added that about 200 new staff had been recruited as part of the new
measures.
King assumed office last November, following the departure
of CEO Brian Hartzer and chairman Lindsay Maxsted in the wake of the
allegations.
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