Bank boss faces MPs inquiry

The chairwoman of the Commonwealth Bank could face a parliamentary inquiry into allegations that the bank’s deposit machine network was used by organised criminals and terrorist financiers as pressure mounts on the nation’s biggest lender.

The House of Representative’s economics committee, which last year started forcing the senior staff of big institutions to face a parliamentary grilling every six months, is considering widening its net to include CBA chairwoman Catherine Livingstone over concerns about what the bank’s board knew.

The CBA is facing claims it breached anti-money laundering and terrorist financing regulations by failing to notify AUSTRAC on 53,700 occasions of the transfer of big sums of money, mostly through the Commonwealth’s self-serve intelligent deposit machines.

In some cases local branches, including the East Perth branch, notified anti-money laundering staff within the bank of issues around questionable deposits, but action was not forthcoming for months. While many questions have been asked of senior staff including the bank’s chief executive, Ian Narev, there are concerns within the economics committee about the role played by the board.

Last week, Greg Medcraft, the head of the corporate regulator ASIC, revealed that he had spoken to Ms Livingstone two days before AUSTRAC launched its action but the issue was not raised by the CBA.

Mr Medcraft told a parliamentary hearing he was a “little stunned” about the omission.

It is understood the economics committee, which is due to question banking executives in October, is considering whether it needs to get both Mr Narev and Ms Livingstone to discuss the issue. The committee last year complained that a culture across all the major banks had led to consumers being ripped off, arguing that in cases where consumers were let down, senior executives should be sacked.

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Apart from the legal action started by AUSTRAC, the only penalty faced by senior CBA staff has been the axing of short-term bonuses while board members are taking a 20 per cent cut to their fees.

Last year, the chairman’s fees at the CBA were more than $850,000.

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