The latest Australian Anti-Corruption Commission (AACCC) corruption campaign has been dubbed “the most expensive political stunt in the history of the nation” by former ABC journalist Michael O’Donoghue.
“I think the most expensive stunt in Australian politics has been the Anti-Money Laundering (AML) crackdown on the banks,” Mr O’Donnell told ABC News Breakfast.
The latest round of anti-money laundering laws introduced in July 2014, came after more than $50 million was stolen from Australian banks during a period of heightened scrutiny of the financial sector.
An investigation by the ABC found that the banks were “selling” their stolen assets to investors in a scheme that involved buying up shares in banks, companies and individuals who had lost money from the crackdown.
When Mr O’tonghue launched his investigation, he had previously spoken of “a lot of money being wiped out”.
“The banks have been selling their stolen asset, and the AML crackdown on that,” he said.
Mr O’Connor said that in his research, he found that in some cases, the banks “didn’t really know” whether they had the legal right to sell the assets to a third party, or whether they were able to make any payments to investors.
However, he said, “many” of the banks had “lost money from AML” and had been “shackled into this very difficult position”.
“You had these banks which were just trying to sell assets, and it was really not clear whether they knew whether they could legally sell these assets to third parties or whether there were any liabilities,” he explained.
“The answer is that they didn’t really have any legal justification to do it.”
Mr Odonghue said he felt the new legislation was “an embarrassment” for the banks and that the public had lost trust in the banks.
He said that his “worst fear” was that “we’re going to see this kind of thing happening again”.
“It is really disappointing that they haven’t acted more decisively to try and protect the Australian public from what has happened,” he told ABC Radio.
It was “just an embarrassing, embarrassing case” that had “been going on for too long”.
He said the banks would be looking to “get some teeth” into the legislation.
AACCP director-general Tony Bailie said the Government had made a “significant commitment” to protecting Australia’s banks and it would continue to take “every necessary step” to do so.
In a statement, the Prime Minister said the Australian people would have confidence in the integrity of the AACCC’s “firm and efficient” enforcement system.
“This Government is committed to working with the Australian Securities and Investments Commission to build the strongest and most effective system for financial and regulatory compliance in Australia, and is committed in this regard to ensuring that no bank or other person is allowed to evade the law by hiding assets in offshore tax havens,” he added.
More to come.