Law Firm Hits Australia's Westpac With Class-Action Suit

Tom Burroughes

5 February 2020

US law firm Bernstein Liebhard has hit the embattled Australian banking group Westpac with a class-action law suit on behalf of investors, linked to claims about the lender’s breaches of money laundering and other controls.

The firm alleges that between 11 November 2015 and 19 November 2019, Westpac made false and misleading statements about a range of issues, such as failing to report more than 19.5 million international funds transfer instructions to AUSTRAC, Australia's anti money-laundering and terrorism financing regulator. The lawsuit claims that it also “did not appropriately monitor and assess the ongoing money laundering and terrorism financing risks associated with movement of money into and out of Australia”.

In November last year AUSTRAC said it was seeking civil penalties from Westpac because of what it calls "systemic non-compliance" with anti-money laundering and counter-terrorism financing laws. The organisation claims that the bank broke AML/CTL laws on more than 23 million occasions. Brian Hartzer, chief executive of Westpac at the time, has resigned.

The law firm boasts that since 1993, it has recovered over $3.5 billion for its clients and has acted for public and private pension funds, among others, to claim assets.

Australia’s banking and wealth management sector has been hit by a number of misdeeds and oversights. Late in 2017, the government created a Royal Commission to probe into a raft of problems concerning mis-selling, weak AML controls and lapses, and other shortcomings. Senior figures at a number of banks have resigned and been replaced.