Economy

Jun 4, 2018

CommBank gives in to AUSTRAC, hands over $700 million

While the government obsesses about the trivial impacts of "militant" unions, large corporations are being exposed for engaging in serious misconduct that has dramatic impacts.

Bernard Keane and Glenn Dyer

Politics editor / Crikey business and media commentator

Earlier this year, the Commonwealth Bank announced it had set aside $375 million for possible penalties arising from charges by the Australian Transaction Reports and Analysis Centre (AUSTRAC) in relation to money laundering. Today, the bank and AUSTRAC announced they had agreed to a penalty of just under twice that, $700 million, as part of CBA's settlement with the regulator over years-long problems with its management and reporting of cash-deposit ATMs.

The bank will also pay some loose change to cover Austrac's costs -- $2.5 million. The result is about on par with earlier estimates based on speculation AUSTRAC wanted $1 billion, which probably accounts for why the CBA's share price lifted after this morning's announcement.

Free Trial

You've hit members-only content.

Sign up for a FREE 21-day trial to keep reading and get the best of Crikey straight to your inbox

By starting a free trial, you agree to accept Crikey’s terms and conditions

18 comments

Leave a comment

18 thoughts on “CommBank gives in to AUSTRAC, hands over $700 million

  1. TraceyR

    It’s a paltry fine, $13,000 per infringement. No one goes to jail. Try laundering money for ISIS just once, and see how many tens of years the judge throws at you.

    I’m sure a few executives from AUSTRAC will be moving to lucrative positions in CBA shortly.

    1. 1984AUS

      Try laundering money for ISIS? Whose to say that isn’t what the banks have been doing. They’ve certainly been caught out doing that overseas, so why not here too.

      Crime and terror in the banks

      https://www.thesaturdaypaper.com.au/news/law-crime/2017/08/12/crime-and-terror-the-banks/15024600005060

      Narev found himself reassuring reporters that the bank had “no evidence that we were assisting with any terrorist funding”. Six days before, the Australian Transaction Reports and Analysis Centre filed a civil action to sue Commonwealth Bank over 53,760 alleged breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act.

  2. Marcus Hicks

    So the bank was clearly guilty of aiding & abetting terrorists & drug cartels, yet no high-profile AFP raids on CBA offices, no arrest of CBA executives, no fear of imprisonment for those involved or the besmirching of their character by the government & mainstream media.

    Now compare that to how the AWU & CFMEU have been treated…..often for completely made up “crimes”!

    #Changetherules

    1. 1984AUS

      Spot on. All of that and more even. And the TURC and their pet Liberal Keynote Speaker presiding has been shown for exactly what it was – an expensive PR campaign against Labor and the Unions.

      Have you read this?

      Demonisation campaign against unions comes a cropper — yet again

      Yet another trade union royal commission prosecution has spectacularly collapsed.

      Anyone seeing a pattern here?

      https://www.crikey.com.au/2018/05/17/cfmeu-union-charges-blackmail/

      Who you going to believe, me or your own lying justice system?

  3. klewso

    To Malcolm, Scott, Matthias et al :-
    Again, “Facilitator (ASIC)” ≠ “Regulator”.

  4. [email protected]

    What’s the difference between Bank Fraud and Government Fraud? Didn’t the Victorian State Government lose $89 million dollars belonging to demented and disabled people via State Trustees?
    The Auditor General fined them for speculating with clients money! Poultry fine!
    But The State Government didn’t pay it back!!!!
    This is State sanctioned fraud isn’t it?

  5. tony.re

    The government receives $700mill, the CBA shareholders lose the same amount and those responsible for allowing the money laundering through ATMs to occur get off scot free. The white collar criminals always come off better than their blue counterparts. Antonio

  6. John Bryson

    Staff ASIC with law enforcers drawn from the same caste as besuited criminals, staff union regulators with law enforcers drawn from the same caste as employers. Yes?

  7. graybul

    The CBA corporate entity transfers $700m . . . to Government that had for years fought tooth and nail to protect Banks from public scrutiny . . . and of the actual living, breathing individuals /perpertrators responsible . . . for facilitating terrorism . . . well; nothing!

    Wonderful lesson for all.

  8. Peter Wileman

    So the bank has negotiated its own sanction – The trillion dollar fine that they deserve would, admittedly, be too much of a shock to the economy, but 700 million against the 10 billion profit is laughable compared to the crimes that this organisation has practiced under the leadership of Ian Narev and his team. On TV this evening Morisson is advising the bank not to pass on the cost to the customers, with the usual smirk on his face. Yeah, sure!
    Malcolm, Scott and Mathias fought tooth and nail to avoid a Royal Commission because there was nothing to see!
    Narev slinks off with his millions in wage and bonuses. Where is the justice?

    1. 1984AUS

      The banks also negotiated the terms of reference for the RC it was alleged; understandable given the ex bankers in Parliament.

      Liberals

      Frydenberg: Deutsche

      Turnbull: Goldman Sachs, Macquarie

      Baird: Deutsche, HSBC, NAB

      Kelly O’Dwyer: NAB

      Arthur Sinodinos: Goldman Sachs.

      Greens

      Whish Wilson: Deutsche, Merrill Lynch

      Nationals

      David Littleproud worked in agricultural banking for 20 years, at NAB and more recently Suncorp.

    2. 1984AUS

      I forgot this happy trio:

      Jane Hume: NAB, Rothschild, Deutsche . The Victorian senator Jane Hume says women and people of non-white backgrounds should “work harder” if they want to get into parliament.

      Bert van Manen Gold Coast MP : financial planner

      Cory Bernardi: financial planner

  9. AR

    A measure of how much a $700M fine hurt is that the share price rose on the news.

    1. Marcus Hicks

      Yep, ’cause they knew it should have been far, far worse. However, much like the AFP & ASIC, AUSTRAC has been effectively neutered when it comes to white collar crimes.

  10. 1984AUS

    I want to thank Bernard Keane and Glenn Dyer and Crikey for their excellent coverage of the RC into Banks that we didn’t need to have according to the Member for Goldman Sachs Turnbull. This article is excellent thanks.

Share this article with a friend

Just fill out the fields below and we'll send your friend a link to this article along with a message from you.

Your details

Your friend's details

Sending...