SYDNEY (Reuters) - The CEO and chairman of Australia’s Westpac Banking Corp (WBC.AX) are out after financial crime watchdog AUSTRAC accused the bank of 23 million breaches of anti-money laundering laws, including payments related to child exploitation.
The Westpac breaches are just the latest in a long line of finance sector scandals in Australia, enough to prompt a year-long inquiry into industry misconduct that was held in 2018.
Here are some involving major companies:
2014 - A Senate inquiry finds Commonwealth Bank of Australia’s (CBA.AX) financial planners forged client signatures to facilitate profit-generating product switches between 2006 and 2010, among widespread misconduct.
The inquiry also found the Australian Securities and Investments Commission (ASIC) put complaints against the country’s biggest bank in the “too-hard basket”.
2016 - Media reports say CBA’s insurance arm, CommInsure, pressured doctors to use outdated medical definitions to refuse payouts to some policyholders, including those who had experienced heart attacks.
ASIC investigation finds CommInsure’s methods were not illegal but “clearly out of step with community expectations”.
2017 - AUSTRAC accuses CBA of allowing 55,700 payments of A$10,000 or more to pass through its branches and “intelligent” electronic teller machines without being reported to the authorities as required. In a court filing, AUSTRAC says many of the payments were made by people convicted of drug dealing, using CBA to launder drug money by sending it offshore.
CBA admits the breach, but says it was largely duplicated because of a software glitch. The bank says CEO Ian Narev will retire by mid-2018, although not directly because of the AUSTRAC matter. Around the time of Narev’s departure, CBA agrees to a penalty of A$700 million, Australia’s biggest corporate fine.
2018 - A Royal Commission into the finance sector hears wealth manager AMP Ltd (AMP.AX) routinely charged customers fees without giving any service, then decided at board level to alter an independent report about the problem to ASIC to delete the name of CEO Craig Meller. Meller quits, followed by chairwoman Catherine Brenner, chief company lawyer Brian Salter, and three directors facing re-election at an upcoming AGM.
2019 - The Royal Commission final report gives a devastating critique of the financial system but largely spared the executives who had testified - except the leaders of No. 3 bank NAB (NAB.AX).
“I am not as confident as I would wish to be that the lessons of the past have been learned,” writes the retired judge who ran the inquiry, Kenneth Hayne, in his final report. “I was not persuaded that NAB is willing to accept the necessary responsibility for deciding, for itself, what is the right thing to do, and then having its staff act accordingly.”
By the end of the week, NAB CEO Andrew Thorburn and chairman Ken Henry have quit in a firestorm of criticism brought on by the two-sentence assessment.
Reporting by Byron Kaye. Editing by Lincoln Feast.