SYDNEY, Australia—Westpac Banking Corp. has reached an agreement with the Australian Transaction Reports and Analysis Centre (Austrac) to settle the anti-money laundering and counter-terrorism financing allegations.
Should the federal court accept the penalty, the bank will pay AU$1.3 billion for breaching the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML/CTF Act) over 23 million times.
Westpac has admitted to the breaches, which include failing to report international funds transfers of more than AU$11 billion, ZD Net reported.
In making the allegations last year, Austrac said the bank consistently failed to: assess and monitor ongoing money laundering and terrorism financing risks; report over 19.5 million International Funds Transfer Instructions (IFTIs) to Austrac over nearly five years for transfers both into and out of Australia; pass on information about the source of funds to other banks in the transfer chain; keep records relating to the origin of some of these international funds transfers; and carry out appropriate customer due diligence on transactions in the Philippines and South East Asia that were related to potential child exploitation risks, ZD Net reported.
‘Deficient Processes’
In its own report into the matter, Westpac in June said a mix of technology and human error and "deficient financial crime processes" were to blame for its failure to comply with anti-money laundering obligations.
"While the compliance failures were serious, the problems were faults of omission. There was no evidence of intentional wrongdoing," CEO Peter King said at the time.
King stepped in following former CEO Brian Hartzer leaving the bank when the Austrac investigation was announced.