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Commonwealth Bank Of Australia (CBA) To Pay A $700 Million Fine With AUSTRAC

Commonwealth Bank of Australia (ASX: CBA) announced today that it has entered into an agreement with AUSTRAC, the Australian Government’s financial intelligence agency, to resolve the civil proceedings in the Federal Court.

According to AUSTRAC and Australia’s largest bank, CBA, the bank:

  • Made 53,506 late filings for threshold transaction reports for cash deposits at its ATMs
  • Had inadequate adherence to risk assessment requirements 14 times
  • Did not monitor transactions as intended between October 2012 and October 2015
  • There were 149 suspicious matter reports filed late or not filed
  • Ongoing customer due diligence requirements were breached in respect of 80 customers

As a result of its misdemeanours, CBA will pay a penalty of $700 million and AUSTRAC’s legal costs of $2.5 million. This settlement follows the recent scrutiny that the big banks are under from the Royal Commission.

CBA CEO, Matt Comyn, said: “While not deliberate, we fully appreciate the seriousness of the mistakes we made. Our agreement today is a clear acknowledgement of our failures and is an important step towards moving the bank forward.”

On behalf of Commonwealth Bank, I apologise to the community for letting them down. – Comyn

The CBA share price has risen by 2.15% in early trade, according to Google Finance. 

CBA had already accounted for an estimated penalty of $375 million in the half-year accounts, meaning its accountants had already adjusted its financial results for some anticipated penalties.

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