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CBA shares fall on law breach accusations

Simone Ziaziaris  |  04 Aug 2017Text size  Decrease  Increase  |  

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SYDNEY - [AAP] Shares in Commonwealth Bank (ASX: CBA) have fallen sharply after the lender was accused of more than 53,000 breaches of laws put in place to combat money laundering and terrorism financing.

At 1021 AEST on Friday, CBA's shares were 2.77 per cent lower at $81.64 after the federal government's financial intelligence unit, AUSTRAC, on Thursday launched civil proceedings in the Federal Court, accusing the lender of systemic failure to comply with anti-money laundering and counter-terrorism financing laws.

CBA could face a maximum penalty of $18 million for each of the 53,700 contraventions, if found guilty.

AUSTRAC claims CBA failed to assess the money laundering and terrorism financing risk of intelligent deposit machines--ATMs that accept up to $20,000 per cash transaction--before rolling them out in 2012, and only took its first steps to assess the risks in mid-2015.

AUSTRAC also alleges the bank failed to provide on time reports of more than 53,500 transactions through IDMs of $10,000 or more, totalling $625 million.

It has also accused CBA of failing to report suspicious matters involving $77 million worth of transactions, either on time or at all.

Australia's largest lender on Friday denied doing anything to enable crime and said it was committed to working with law enforcement agencies.

The bank said it reports four million transactions to AUSTRAC each year.


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