Shareholders ‘let down’
LAWYERS mounting a class action against the Commonwealth Bank say an apology for the bank’s money laundering scandal is not enough.
Law firm Maurice Blackburn says the apology by chief executive Ian Narev is welcome but the bank should have conducted itself better.
“It’s a good thing, but in the end what would have been a better thing would have been if the bank had behaved responsibly towards its shareholders in the first place,” Maurice Blackburn head of class actions Andrew Watson said.
He was speaking after the class-action suit – potentially Australia’s biggest ever – was filed against the CBA yesterday in the Federal Court.
It alleges the lender breached anti-money laundering legislation thousands of times.
Mr Watson and lead plaintiff William Phillips, a 63-yearold retired coconut farmer, faced a press conference after Maurice Blackburn filed the lawsuit, which also alleges executives including Mr Narev knew about the money laundering scandal but failed to tell the market about it.
Mr Phillips said he had recently dumped $250,000 worth of CBA shares and bought ANZ instead.
Shareholders had been treated “poorly, really poorly,” he said. “We have the right to full disclosure and we didn’t get it.
“It’s market sensitive information, it’s price-sensitive.”
Mr Phillips said if he had known about the money laundering scandal, he probably wouldn’t have taken up a share offer, but if he did take it up, the shares “would have been a lot cheaper” regardless.
The class action, filed yesterday on an open basis, accuses the CBA of failing to keep shareholders up to date while making “misleading and deceptive” statements about its compliance with anti-money laundering laws.
The class action suit includes shareholders of the bank who bough shares between mid-July 2015 – when it is understood the bank first learned it had been failing to send transaction reports to anti-money laundering agency Austrac, and early August this year. That is when the agency filed its allegations in the Federal Court.
It complicates matters for the CBA, which is still building its defence against the Austrac claims and is now fighting legal fires on several fronts.
The bank has until mid-December to file its defence to the case by Austrac, which will then be given until mid-March to respond to the bank’s defence. A subsequent case management hearing has been scheduled for April 2.