The bank is being taken to court over insider trading over a A$16 billion ($12 billion) interest rate swap linked to the part-privitization of energy distribution network Ausgrid in 2016.
Another regulatory scandal is brewing at Westpac, Australia's second-largest lender, with the country's corporate watchdog accusing the bank of money laundering, «Reuters» reported on Wednesday.
According to the Australian Securities and Investments Commission (ASIC), Westpac, which knew it won a contract to help two pension funds buy Ausgrid, used inside information to trade in interest rate derivatives for two hours before it executed the swap, the report said.
«The Ausgrid information was not generally available and it was information which, if generally available, a reasonable person would expect to have a material effect on the price or value of the traded products,» ASIC said in the civil lawsuit filed on Wednesday that named seven employees and former employees of the bank.
Regulatory Blow
The latest development is a major blow to the bank, which in September 2020 paid a record A$1.3 billion fine for money laundering breaches that took place between 2013 and 2018.
Amid the fallout from the scandal, Westpac brought in a new CEO, Peter King, in April 2020 to repair the bank’s damaged reputation.
ASIC also took Westpac to court in 2018 for its involvement in the fraudulent setting of interbank lending rates in 2010. That time, the bank was ordered to pay A$3.3 million in fines.
