Westpac Banking Corp., which was accused of more than 23 million instances of money laundering by Australian regulators, said Nov. 24 it is closing its LitePay international funds transfer system and may withhold some bonuses for its full executive team and some managers, among other things.
The Australian Transaction Reports and Analysis Centre accused Westpac of "serious and systemic noncompliance" with the country's anti-money laundering act. Westpac allegedly allowed correspondent banks to access its banking environment without conducting due diligence on them. The lender also allegedly failed to report over 19.5 million international fund transfer instructions to AUSTRAC for nearly five years.
Westpac's Chairman Lindsay Maxsted said the bank recognizes the seriousness of these events. "We accept that we have fallen short of both our own and regulators' standards and are determined to get all the facts and assess accountability," he said in a Nov. 24 release.
Westpac said it is reviewing all financial crime systems and processes. It has increased focus on priority screening where Westpac flags transactions that suggest potential child exploitation. These transactions are now prioritized and are reported to AUSTRAC within 24 hours.
AUSTRAC had accused the bank of failing to carry out appropriate customer due diligence that could have led to potential child exploitation risks.
The bank said it would an external expert to review its processes and will make the recommendations public.