Where There Is A Will, There Is Always A Way

New York-based law firm Rosen Law Firm [1] has filed a class action lawsuit against ‘big four bank’ Westpac over the Australian Prudential Regulation Authority scandal. The investigation comes after Australia’s financial intelligence agency, Austrac, launched legal action against Westpac last month alleging that the Bank breached Anti-Money-Laundering and counter-terrorism finance laws 23million times, (and sadly, that number is no exaggeration). This steep number included allowing customers to transfer money to the Philippines in a manner consistent with child exploitation.

The lawsuit seeks to recover damages for investors in the United States on behalf of purchasers of Westpac securities on the New York Stock Exchange (NYSE) between November 11 2015, and November 19, 2019 inclusive [2]. The class action refers to the Bank's monitoring of financial crimes which are currently the subject of an AUSTRAC proceeding in the Federal Court of Australia. APRA said that they would cooperate with investigations being conducted by Austrac and the Australian Securities and Investments Commission, however have yet to fully disclose certain information pertaining to the allegations. Separately, federal police are investingating the payments to the Philippines [3].

The impact of money laundering is far beyond a matter of fines- there are social, economic and reputational impacts. For those found guilty of enabling money laundering, there can be very long- term consequences. Service providers may find that customers stop coming to their business. This is because money laundering offences are huge, headlining news in big companies. Being in the headlines for all the wrong reasons spells reputational damage. As a result, customers lose trust in the company. This impacts a revenue stream in a huge way and can affect daily business activities.

So what can banks do to ensure this doesn’t keep happening?

Banks need to increase their drive to increase their regulatory oversight- both internally and externally. Here at Lysis Financial, we deliver expert consulting in Anti-Money Laundering (AML), AML Reviews and Maturity Assessments, policies and procedures. We have the ability to help you prepare for regulatory visits and regulatory remediation. Our governance risk and compliance teams aim to provide peace of mind that strategy, risk and regulation support and enable your people, culture and values. We help you embed governance at all levels of your business, including board- level buy in, ensuring everyone is clear about their roles and responsibilities [4]. Our aim, with every client, is to develop a holistic and resilient approach to Governance, Risk and Compliance that not only embraces change but seeks to continuity within this ever evolving environment.


By Lauren Parmenter, Consultant at Lysis Group

[1] https://www.rosenlegal.com/ [2] https://markets.businessinsider.com/news/stocks/rosen-a-globally-recognized-law-firm-files-securities-class-action-lawsuit-against-westpac-banking-corporation-encourages-investors-with-losses-in-excess-of-100k-to-contact-the-firm-wbk-1028864264 [3] https://www.theguardian.com/australia-news/2019/dec/17/westpac-scandal-apra-launches-full-investigation-into-bank-over-child-exploitation-allegations [4] https://www.lysisgroup.com/Services/Governance-Review