CBA blames money laundering reporting failures on ATM coding error

CBA blames money laundering reporting failures on ATM coding error

Commonwealth Bank of Australia has blamed a three-year coding error in its intelligent deposit machines (IDM) for breaches of anti-money regulations.

The Bank is currently being sued by financial crime regulator Austrac for failing to report suspicious transactions totalling A$624 million.

In a statement, the bank says a software update to its IDM network in 2012 resulted in a coding error which meant that the machines failed to create Threshold Transaction Reports required under AML rules. The glitch went unnoticed and unresolved until its discovery in 2015.

"In an organisation as large as Commonwealth Bank, mistakes can be made," the bank says in a statement. "We know that because we are a big organisation, these mistakes can have significant impact."

CBA says the coding error was responsible for the "vast majority" of the 53,000 violations detailed by Austrac, but adds "we recognise that there are other serious allegations in the claim unrelated to the TTRs".

Austrac's actions have once again drawn attention to the power of the Big Four banks in Australia and their apparent willingness to play fast and loose with the rule-book, leading the political class to call for a far-reaching inquiry and the head of CBA chief Ian Narev.

Comments: (1)

Hitesh Thakkar
Hitesh Thakkar - SME - Fintech startups (APAC and Africa) - India 09 August, 2017, 12:28Be the first to give this comment the thumbs up 0 likes

Australia is not alone, it happens in India also. Few large banks ( can not name in public) in India goes loud for it's sheer size issue and ask to get away with regulatory compliance and reporting.

Defaulter list with big names is published recently by regulator is classic example about risk exposures not reported correctly by these banks resulting in NPA.