Shadow hangs over Commonwealth Bank despite it posting record $9.88 billion profit with big bonuses for bosses and shareholders
Ross Greenwood: 16.6 million Customer; 800,000 thousand shareholders; 51, 800 employees – all of them reliant on the reputation of the Commonwealth Bank.
And today, after allegations the bank gave money launderers and drug syndicates unfiltered access to its accounts, at least one customer called it quits.
Jacqui Lambie: CBA should be renamed the Criminal Bank of Australia.
I will be moving my personal banking out of the CBA into a local credit union today.
Ross: The bank again defended itself against allegations made by government money tracking regulator, AUSTRAC, claiming more than 53,000 contraventions.
The Commonwealth will claim there’s just one contravention, and chairman Catherine Livingston said the board has no reason to believe the allegations arose from deliberate or unethical behaviour or any commercial motive.
Just a question for you, how did the crooks actually find out about this loophole to put so much money through over such a long period of time?
Ian Narev: Criminal elements, if they ever find vulnerabilities, exploit them very rapidly.
Now here, we’ve already said we’ve made mistakes and there are very clearly areas where our standards weren’t up to it and we need to face the consequences of that.
Ross: The suspicion is that it feels like there’s an inside job…
Ian: I think that’s a very long bow to draw Ross…
Ross: The board’s wiped out short-term executive bonuses, and given itself a 20% pay cut.
But is it enough?
Ian: If there’s accountability to be had, accountability will be had.
Ross: But there’s another reason for the pay cut.
At last year’s annual general meeting, the shareholders voted against the company’s executive remuneration report. If they do the same thing this year, under company law, the board must resign and put itself up for re-nomination.
Judith Fox: I don’t think shareholders would want to see a whole spill of the board, that would be so disruptive.
Ross: As for the bank itself, the boss says it’s in great shape.
Ian: We’ve got three dollars out of every four dollars of that profit.
Three dollars out of every four dollars going to our shareholders, and 80 percent of those are Australian families.
Ross: Ross Greenwood; Nine News