NAB facing AUSTRAC investigation over potential ‘serious and ongoing’ breaches

National Australia Bank is facing allegations of potentially serious and ongoing non-compliance with anti-money laundering laws, with the financial crimes watchdog launching a formal investigation into whether to take legal action.

AUSTRAC wrote a letter to NAB on June 4 outlining serious concerns with NAB’s customer identification procedures, ongoing customer due diligence and compliance with anti-money laundering and counter-terrorism financing laws.

AUSTRAC has now referred the matter to its enforcement team where it will determine whether any further action is taken, but the regulator pointed out it was not considering enforcement action at this point.

“AUSTRAC has a wide range of enforcement options available to it, including civil penalty orders, enforceable undertakings, infringement notices and remedial directions,” the regulator said.

The letter comes after “regular engagement” with NAB over “a long period of time”, with compliance problems flagged in its recent half-year financial report.

NAB chief Ross McEwan said NAB would cooperate with AUSTRAC’s investigations.

“NAB takes its financial crime obligations seriously. We are very aware that we need to further improve our performance in relation to these matters. We have been working to improve and clearly have more to do,” Mr McEwan said.

“NAB has an important role in monitoring and reporting suspicious activity and keeping Australia’s financial system, our bank and our customers safe.”