Saturday, October 31, 2020

Shareholders filed class action against Westpac over money laundering scandal

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Australia’s Westpac Banking Corp on Wednesday said a law farm had filed a class action against the lender on behalf of certain shareholders who acquired a stake between December 2013 and November 2019.

Phi Finney McDonald filed the suit over market disclosure issues connected to the company’s monitoring of financial crime over the six-year period and recent proceeding against the lender by the country’s financial crime watchdog AUSTRAC.

Shares of the country’s second-largest lender fell more than 1% in early trade and were last down 0.3%.

The lawsuit is the latest among about a dozen filed after a Royal Commission inquiry found evidence of widespread misconduct in the financial sector.

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“The claim does not identify the amount of any damages sought,” Westpac said in a filing to the exchange.

Westpac was also sued by regulators who cited 23 million breaches of anti-money laundering laws and the country’s oldest lender accepted most of their assertions.

Westpac will be required to hold an extra A$500 million ($339.30 million) in capital after the Australian Prudential Regulatory Authority announced an investigation into its alleged money laundering breaches.

Australian financial firms are fighting hard to stand on their own feet after the damning public inquiry report, and the Westpac scandal has put the spotlight back on the country’s big lenders once again.

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In September, Westpac was served a class action lawsuit accusing it of charging thousands of pension fund customers for services they never received. ($1 = 1.4736 Australian dollars)

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