The Commonwealth Bank will be required to pay $25 million as part of an enforceable undertaking accepted by ASIC in the wake of the bank bill swap rate scandal.
In a statement, ASIC said the major bank will pay $15 million in community benefit payments, $5 million to cover ASIC’s investigation and legal costs and $5 million in pecuniary penalties to the Melbourne Federal Court.
On 9 May, CBA reached an in-principle agreement with ASIC to settle proceedings over attempts to engage in unconscionable conduct that breached the ASIC Act.
"As part of the undertaking, CBA will pay $15 million to be applied to the benefit of the community and $5 million towards ASIC’s investigation and legal costs," the statement from ASIC said.
The major bank will also be engaging the services of an independent expert to assess changes CBA has made and will make to its "policies, procedures, systems, controls, training, guidance and framework for the monitoring and supervision of employees and trading" relating to Prime Bank Bills.
"CBA also admitted that it failed to do all things necessary to ensure that they provided financial services honestly and fairly and that its traders were adequately trained," the statement said.
Melbourne Federal Court's Justice Beach said the $25 million penalty "should be an adequate denouncement of and deterrence against the unacceptable trading behaviour of individuals within CBA that ought to have known better and a bank that ought to have better supervised its personnel".
ASIC has also brought proceedings against the other major banks for manipulating the bank bill swap rate.
NAB and ANZ have both reached a settlement with ASIC for $50 million.
Westpac has dodged the rate rigging charges altogether despite being found out for engaging in unconscionable conduct.
Updated: A previous version of this article referred to the payments as "additional penalties". This has been corrected to show that the $25 million penalty is the sum previously agreed to in CBA's in-principle agreement with ASIC.
Boutique fund manager Maple-Brown Abbott has insisted the recent upturn for value stocks will persist into the future, going against the mou...
The chief executive of the world’s largest asset manager believes that the doom and gloom of 2020 will see interest in sustainable invest...
Climate change impacts and rising sea levels could cost the Australian economy $100 billion each year within the next two decades, according...
Get notifications in real-time for staying up to date with content that matters to you.
Read More