CBA says “software error”. Insider says “no one gave a rat’s arse”

by | Aug 11, 2017 | Despatch, Finance

A Commonwealth Bank insider has rejected the bank’s claims that a “software error” caused its systematic money-laundering. Rather, it was due to management incompetence and a culture in which compliance ran a poor second to profit.

The person, who does not wish to be identified, said bank executives were warned about system problems involving the the interface with AUSTRAC but said, “No one gave a rat’s arse”.

“Compliance always comes last in CBA and it is frequently and quietly dropped, overlooked and omitted,” said the person. “As for this “software error” … haha”.

In response to questions from michaelwest.com.au, a CBA spokesman said: We’re currently reviewing the statement of claim.

“All of our statements in relation to the matter are available here – https://www.commbank.com.au/personal/newsroom.html

“We can’t offer any additional information at this time.”

CBA, which handed down a record $10 billion profit result this week, is the subject of a lawsuit by the money-laundering and counter terrorism watchdog AUSTRAC which alleges the bank presided over more than 53,000 breaches of Australia’s money-laundering and counter terror-financing laws (AML-CTF).

At the heart of the claims is the alleged misuse of the bank’s intelligent deposit machines, which can take deposits of up to $20,000 at a time. Criminal gangs routinely washed large amounts of money through CBA’s IDM machines.

The CBA source said the breaches would not have occurred if the “end-to-end” testing had been properly done, that is the E2E systems testing between the bank’s interface, the warehouse and AUSTRAC.

Australia was recently criticised by the Financial Actions Task Force (FATF) – the international body charged with ensuring nations comply with money laundering and counter terrorism financing standards – for failing to comply. The michaelwest.com.au exclusive here:

Australia on watch-list as China billions pour into property

ABOUT THE AUTHOR

Michael West

Michael West

Michael West established michaelwest.com.au to focus on journalism of high public interest, particularly the rising power of corporations over democracy. Formerly a journalist and editor at Fairfax newspapers and a columnist at News Corp, West was appointed Adjunct Associate Professor at the University of Sydney’s School of Social and Political Sciences. You can follow Michael on Twitter @MichaelWestBiz.

6 Comments

  1. Avatar

    bank presided over more than 53,000 breaches of Australia’s money-laundering and counter terror-financing laws (AML-CTF).

    Why did Austrac take so long to take action?

    53K is a hell of a lot of laundering.

    • Avatar

      Good point Bob. Have just shared your comment on Twitter/FB.

      • Avatar

        53,000 x $10K = $530,000,000 and I would say that is the tip of an iceberg as deposits would have been more than $10K.

        If the govt was serious they would be going after these money launderers just to collect tax and then getting the AFP to lay charges.

        This govt. has demonstrated that they approve and encourages corruption as well as turning a blind eye to Joyce’s water theft and allowing Brough/Ashby not to be charged.

        The 7/11 saga was also plain theft and again no one gets charged.

        And if you are a welfare recipient who might have been overpaid Alan Tudge said “We’ll find you, we’ll track you down and you will have to repay those debts and you may end up in prison.”

        Personally I think the whole of the LNP belong in prison.

      • Michael West

        Spot on Bob

  2. Avatar

    I say fine the bastards. Send ’em bankrupt.

    • Avatar

      Then perhaps the government could take over the bank again. Don’t recall chronic bank bastardry, money laundering, obscene CEO salaries, etc prior to the 1990s when the bank was privatised. Responsibility and accountability was the order of the day then. CEOs got a reasonable salary but most were happy to get a gong in the New Year honours and regular invite to the Governor’s Xmas Party! I mean how do you really spend all those millions?

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