The Commonwealth Bank is being accused of 53,700 breaches of money laundering and terror financing laws.
COMMONWEALTH Bank executives will be hit in the pocket over the bank’s more than 53,000 alleged breaches of anti-money laundering and counter-terrorism financing laws, with chief executive Ian Narev among those losing bonuses for the past financial year.
CBA on Tuesday said its board still had full confidence in Mr Narev but that short-term incentives for the CEO and his group executives will be cut to zero to demonstrate “collective accountability” for what it has said was an IT error. Mr Narev was paid $1.43 million in short-term cash bonuses in the previous financial year, with CBA handing out a total $8 million to the CEO and 11 executives.
Commonwealth Bank’s full-year results for the 12 months to June 30 are due for release on Wednesday, while the remuneration packages will be included in next week’s annual report.
“The board recognises heightened public interest in executive remuneration, particularly having regard to the civil penalty proceedings initiated last week by the Australian Transaction Reports and Analysis Centre (AUSTRAC),” CBA chairman Catherine Livingstone said in a statement to the Australian Securities Exchange.
The bank said non-executive director fees will also be cut, by 20 per cent, in the current financial year.
AUSTRAC alleges CBA failed to provide on-time reports of 53,506 cash transactions of $10,000 or more and totalling $625 million that were made through the bank’s new Intelligent Deposit Machines (IDMs) from November, 2012 to September, 2015.
In a statement on Monday, CBA said a coding error, which occurred following a software update to its IDMs in late 2012, was responsible for the required Threshold Transaction Reports (TTRs) not being generated.
CBA said the fault was fixed within a month of it being discovered in 2015.