Westpac Shares Plummet After Watchdog Accuses Bank Of More Than 23 Million Breaches
Westpac shares have hit a six-month low after Australia's financial intelligence agency accused the lender of breaching anti-money laundering and counter-terrorism financing laws more than 23 million times.
The AUSTRAC court action - which also involves allegations Westpac failed to properly investigate transactions to the Philippines and other parts of Southeast Asia related to potential exploitation of children - could lead to a huge fine for the firm.
Rival Commonwealth Bank last year settled a similar case related to 53,000 breaches for an Australian corporate record $700 million.
Westpac chief executive Brian Hartzer in response said the bank had already publicly disclosed that it had self-reported failures around a large number of international funds transfers.
Nonetheless, he admitted the problems identified should never have occurred and should have been fixed sooner.
"It is disappointing that we have not met our own standards as well as regulatory expectations and requirements," Mr Hartzer said.
The bank's share price was 2.9 per cent lower at $25.78 by 1300 AEDT on Wednesday, having bottomed out at $25.77 shortly after it responded to AUSTRAC's claims.
The bank's share price last hit a trough that deep after May's disappointing first-half profit, with the most recent nadir nearly 14.2 per cent down from a 15-month price peak of $30.05 in September.
Former CBA boss Ian Narev announced he would be stepping down after AUSTRAC launched similar court action in 2017, while the CBA board also cut senior executives' bonuses in an attempt to limit the fallout.
Shares in CBA, ANZ and NAB were each more than one per cent lower, seemingly dragged down by Wednesday's news, weighing heavily on the ASX in the early afternoon.