Australia's Westpac reveals findings from compliance review
Australian lender Westpac Banking Corp (WBC.AX) on Thursday
blamed “faults of omission” and “not intentional wrongdoing” for breaching
anti-money laundering and counter-terrorism laws.
Last November, Australian regulator AUSTRAC filed a civil
lawsuit, accusing the bank of presiding over 23 million payments that violated
anti-money laundering protocols, including those made by Australians to child
pornography purveyors in the Philippines.
The country’s second-largest bank last month admitted to
charges of breaching money laundering laws, but denied accusations it enabled
illegal payments between known child sex offenders.
Unclear accountabilities as well as a lack of understanding
and expertise caused compliance failures, the company said in a statement.
The bank, which concluded its investigation into issues
raised by AUSTRAC, said that the failure to correctly report international
transfer of funds was due to a mix of technology and human error going back
more than a decade.
“Consequences that have been applied to individuals include
significant remuneration impacts and disciplinary actions,” Westpac Chief
Executive Officer Peter King said. “A number of relevant staff had already left
the company.”
The allegations from the regulator have led to a string of
senior management changes at the company, including the chief executive and
chairman roles. Earlier this week, the bank announced that the head of its
institutional bank was retiring.
A report from the advisory panel review into the charges
noted that the directors could have recognised the systemic nature of the
crimes the bank was facing earlier.
Westpac said it would continue to engage with AUSTRAC on the
legal process.
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