Commonwealth Bank of Australia is not taking their money laundering charges lying down.That is only be expected, considering this was facilitated by their intelligent ATMs. It turns out the group is blaming the laundering on ATM coding errors. An interesting turn of events, to say the least. It remains to be seen if this explanation will affect the ongoing investigation by Austrac, though.
Late last week, we talked about Commonwealth Bank of Australia. The financial institution faces over 50,000 money laundering charges as we speak. Various drug syndicates allegedly made use of the company’s intelligent ATMs to launder millions of Australian Dollars. Austrac is currently suing the bank for misconduct. The amount of money laundered adds up to US$624m so far. Earlier reports indicated this sum was a lot lower.
Commonwealth Bank Blames a Software Glitch
According to Commonwealth Bank of Australia, an ATM coding error is to be blamed. That is rather surprising, to say the least. Putting the blame on someone else is always an easy way out. A software update to its IDM network in 2012 resulted in this coding error. As a result, the intelligent ATMs can’t create Threshold Transaction Reports. More specifically, the bank can’t adhere to AML rules. It took until 2015 for this glitch to be discovered. While it is true such a glitch is problematic, failing to notice it for three years is still unacceptable.
Mistakes can certainly be made, especially in an organization the size of Commonwealth bank. Every single mistake will have a significant impact on day-to-day operations, though. Violating AML regulations is never acceptable under any circumstance. Blaming the vast majority of the money laundering offenses on a coding error is convenient, to say the least. Austrac clearly wants to make an example of this bank and their negligence. Banks are far too willing to not take the rules seriously and should be punished accordingly.
For the time being, it remains to be seen if Austrac will believe the bank’s statement. A coding error going unnoticed for three years almost sounds like it was hidden on purpose. Moreover, it is possible some discovered it yet things were covered up accordingly. It remains to be seen how this “revelation” will affect the ongoing court case, though. A software error can’t be prosecuted, but Commonwealth bank certainly can. Rest assured this ‘glitch” will not get the organization out with just a slap on the wrist either.
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