4 August 2017: TI Australia comments on CBA case

Transparency International Australia (TIA) commends AUSTRAC, Australia’s financial intelligence agency, for investigating and pursuing all cases of alleged breaches of money laundering and counter-terrorism-financing laws.

This is the first time AUSTRAC has stepped up and tried to sanction one of Australia’s banks, and only the second time AUSTRAC has pursued a major corporation in Australia – TABCORP, being the first.

‘We may well be at a tipping point in AUSTRAC’s capacity to combat money laundering and the proceeds of crime to finance terrorism in Australia’, said Serena Lillywhite, CEO of Transparency International Australia.

The reporting of suspicious transactions by financial institutions is fundamental to ensuring the risk of money laundering is mitigated and managed. However, the CBA case, if proven, indicates it is no longer appropriate for banks just to report, but to act, including by closing accounts.

‘Money laundering and counter-terrorism financing systems and controls within banks, need to be more tightly regulated and enforced, and extended to non-financial entities, including real estate agents, lawyers, and accountants’, said Lillywhite.

The CBA case, if proven, highlights the risk of illicit financial transactions, often the proceeds of crime, being laundered through Australia and other major financial markets. It also highlights the speed, and apparent ease, with which suspicious transactions and the transfer of funds can occur with anonymity. The CBA case will be investigated as a civil rather than criminal case, with the potential for hefty fines, rather than possible criminal charges.

‘Money laundering appears far too easy in Australia’, said Lillywhite. ‘More needs to be done to understand who is making the transactions, where funds have come from, and who will benefit from the transactions. The principle of “know your customer” seems obvious, and reporting of suspicious transactions is required by law, but closing accounts may be the necessary next step’.

The reported scale ($77m worth of suspicious transactions), the systemic nature (53,700 reported transactions), and ease of the alleged CBA money laundering transactions, support TIA’s call for strengthened anti-money laundering laws, the establishment of a publicly accessible register of beneficial ownership, and the need for a national anti-corruption agency.

Note: CBA is a member of TIA. TIA will engage directly with the bank, to encourage the strengthening of their internal systems and controls, and compliance with AML laws and the criminal code.


For further information please contact:

Serena Lillywhite, CEO, TIA

0403 436 896