Westpac executives escape penalties after ASIC ends investigation into the bank’s alleged compliance failures

Westpac CEO Peter King. (Sam Mooy, Getty Images)
  • ASIC has decided against penalising any Westpac executive for their roles in its 23 million breaches of anti-money laundering and counter-terrorism financing laws.
  • The conclusion of the investigation was reported by the bank in a statement to the ASX last night.
  • Westpac had paid $1.3 billion dollar and admitted to the allegations in September, following a nearly year long investigation by the regulator.
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Despite admitting to millions of compliance breaches that lead to the largest ever corporate fine in Australian corporate history, the corporate watchdog has decided against taking individual action against Westpac executives.

On Wednesday evening, Westpac said that the Australian Securities and Investment Commission (ASIC) had wrapped up its investigation into allegations about the company’s compliance failures.

“ASIC has today informed Westpac that it has concluded the investigation and that it does not intend to take any enforcement action against Westpac or any individuals in connection with the investigation,” read a company statement given to the ASX.

In September, Westpac agreed to pay $1.3 billion settlement to end a a nearly year long investigation by the financial crimes watchdog AUSTRAC.

The bank admitted to more than 23 million breaches of anti-money laundering and counter-terrorism financing laws. Both the company’s CEO and chair left following the investigation.

ASIC began its investigations after AUSTRAC launched its civil proceedings.

Additionally, Australian Prudential Regulation Authority had also begun its own separate investigation, including whether it contravened parts of the Banking Executive Accountability Regime (BEAR).

Under BEAR, APRA can enforce penalties on individuals for compliance failures.

Despite this, ASIC has chosen not to pursue any Westpac executives for their involvement in the saga.

Earlier this month, APRA agreed agreed to enforced undertakings from Westpac to “lift substantially its efforts to address risk governance deficiencies.”

Both ASIC and Westpac declined to comment further.