ASIC to investigate CBA money laundering

By Leith van Onselen

ASIC has announced that it too will investigate CBA for failing to comply with continuous disclosure rules relating to its money laundering scandal. From The ABC:

ASIC chairman Greg Medcraft said the corporate regulator would investigate whether the CBA’s board complied with continuous disclosure laws when it decided not to alert investors to the suspicious behaviour.

Earlier this week, CBA chairwoman Catherine Livingstone said the bank’s board first became aware the intelligent deposit machines were at risk of being targeted by criminal elements including money launderers in the second half of 2015.

Speaking to a parliamentary joint committee in Sydney this morning, Mr Medcraft said ASIC would look specifically at whether the CBA’s officers and directors complied with their disclosure duties under the Corporations Act.

“I wanted to inform the committee that ASIC has commenced inquiries into this matter and any consequences this matter has for the laws we administer,” Mr Medcraft said.

Mr Medcraft said the probe would examine whether the CBA complied with their licensing obligations, “to act efficiently, honestly and fairly” in line with a requirement to report potential liabilities.

Chief executive Ian Narev has rejected criticism the bank’s board should have informed investors as soon as it became aware of the gravity of the money-laundering allegations.

“In an organisation of this size there are individual items that come to the attention of board and management from regulators and others all the time,” Mr Narev told the ABC on Wednesday.

“We shouldn’t and can’t be in a situation where we could disclose every time anything comes to our attention. That would end up being very confusing to the market.”

More grist for the banking Royal Commission mill.

[email protected]

Comments

    • Are you a man-child like that Migtronix. You guys remind me of the crawler at the back of the classroom “Miss Miss, Simone is doing something wrong” simply to be serial irritants and suck up to the teacher.

      Both of you are wrong. Leave me alone.

  1. Reserve Bank has stepped into the fray:

    IReserve Bank of Australia governor Philip Lowe has slammed the Commonwealth Bank of Australia over its money laundering scandal, calling it very serious and warning that banks need to be held to account.

    He also says public trust in banks has been “strained” and that service has taken a back seat to sales.

    “Banks should not be doing money laundering and they should know who is operating the accounts that they open, they are very important laws and they need to be respected,” Dr Lowe told federal parliament’s House Standing Committee on Economics.

    “If shortcomings are identified then there needs to be accountability and that accountability needs to be both through the courts and internally within the organisation.

    “It is very serious — we have these laws for a reason and they need to be enforced and people need to be held to account.”

    Would Glenn Stevens has spoken in this manner. Something tells me no.

    http://www.theaustralian.com.au/business/financial-services/rba-chief-philip-lowe-slams-cba-over-money-laundering/news-story/8505518c306a6c33916ed0c50869a06c

    To complete the trifecta all needed now is the AFP, that would be the big one.

    Looks like a round-up of various bodies who have some regulatory oversight role talking tough.
    ASICs most recent report detailing actions taken:

    http://asic.gov.au/regulatory-resources/find-a-document/reports/rep-513-asic-enforcement-outcomes-july-to-december-2016/

  2. This might not blow over like the sharks in the fancy suits thought it would. If my name was Narev, I’d be in Condition Brown right now.

  3. 53000 reportable transactions x $20,000 maximum = max. $1.06 billion concerned, in some finite period.

    Where is the inquiry into the laundering of hundreds of billions of dollars through Australian real estate by banks, accountants, solicitors and real estate agents, in hundreds of thousands of transactions spanning years and years, with the government’s approval through inaction?

  4. “In an organisation of this size there are individual items that come to the attention of board and management from regulators and others all the time,” Mr Narev told the ABC on Wednesday.

    53,000 x 18,000,000 is the potential cost of this. My calculator doesn’t even go that high! Is it not worthy of a mention to investors?

    • 53x18x1000x1000000 = (1060-106)bn=954bn if my mental arithmetic holds. But Tabcorp settlement at a lower rate than that.

      • The total max exposure was computed at 966bn so the extra 12bn suggests the transgressions numbered approx 53667, as 667*18m=0.667*18bn=12bn

  5. I feel so much better now that ASIC has said they are going to think about maybe doing something.

  6. They’ll be wearing the same x-ray glasses the RBA board use for looking through inflation.