9News: Commonwealth Bank faces Class Action
Ross Greenwood: Just one day into the job, and new Commonwealth Bank (ASX:CBA) Boss Matt Comyn has his hands full.
Potentially, billions of dollars full.
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Tim Finney: The losses that have been sustained are sufficiently large
Ross: The new class action alleges the Commonwealth mislead investors by not telling them they had breached requirements to report money laundering and terrorism financing transactions.
Tim Finney: It actual damages the confidence in the entire investment community and the integrity of Australian companies.
Ross: It’s the second class action to hit the bank.
Andrew Watson: Companies are required to disclose to the market immediately the moment they become aware of something which is of material to the price of value of their shares
Ross: But this new class action is backed by some of the world’s biggest investors including the California State Teacher’s Retirement System – the second-largest pension fund in the US. It owns more than $200 million of Commonwealth Shares.
Also in the Class Action is the Texas Teachers Fund, the Massachusetts Investment Board and the Colorado Public Employees Retirement Association – together, more than $600 billion worth of assets, almost one-third of Australia’s total in Superannuation.
The central allegation is those who bought shares between June 2014 and August 2017 were misled. The claim suggests that they should’ve known AUSTRAC would be been concerned about suggestions so-called smart ATM’s were being used for financing terrorism and money laundering.
The Commonwealth set aside $375million for possible future penalties from the AUSTRAC Action, but if successful, these class actions could cost hundreds of millions dollars more.
The irony is that if they do win, it’s the Commonwealth shareholders whop will pay.
Ross Greenwood, Nine News.
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Ross Greenwood
Ross Greenwood is the Nine Network’s business and finance editor, and hosts Sydney's top-rating radio program, Money News, for 2GB, 4BC. 3AW and all networked stations across the Macquarie Media group. He appears daily on the Today Show - and Nine News.
