>> It's the biggest corporate fine in Australia's history, and it's being dished out to the country's largest bank. The Commonwealth Bank has agreed to pay a fine of nearly $530 million to settle money laundering charges brought by Australia's Financial Intelligence Agency. Court documents said the money laundering through the banks teller machines included the proceeds of illegal firearms and drug deals.
Reuters' Paulina Duran in Sidney explains what went wrong.>> CBA failed to comply with anti-money laundering and terrorism financing rules. Particularly when introduced deposit machines that allowed terrorists and criminals to transfer money. The bank basically didn't have enough controls. It didn't really pay enough attention and it allowed more than 53,000 breaches to happen.
Those breaches included instances where it didn't report suspicious activity, where it, they didn't give the police and the intelligence agencies the necessary information.>> The case has already caused an executive shake up at the bank. And this is the second major case Commonwealth settled with regulators in a month, after admitting to rate manipulating allegations just weeks ago.
It comes in a difficult time for Australia's banks as an independent inquiry looks into widespread revelations of misconduct across the sector.>> It is quite significant and is a bit of a warning for other banks and financial institutions to take the law seriously.>> Despite the scale of Monday's fine, Commonwealth share price grows after the news.
Analysts say investors were relieved the penalty wasn't bigger. Last month, the bank was also audit to carry an additional $750 million in reserve capital. Until it satisfies regulators, it is capable of stopping similar breaches in the future.