Westpac money-laundering scandal: Bank chief executive Brian Hartzer quits | Business News


The boss of Australia’s second-largest bank, Westpac, has quit over a money-laundering scandal involving child exploitation.

The departure of chief executive Brian Hartzer comes just a day after he told staff it was “not a major issue” and that he planned to stay on.

Chairman Lindsay Maxsted has also brought forward his own retirement as Westpac in the face of legal action by the financial crime regulator, which threatens to land the lender with potentially billions of pounds in fines.

AUSTRAC has accused the bank of enabling 23 million payments in breach of anti-money laundering laws, including transfers linked to child exploitation in Southeast Asia.

Mr Hartzer, who leaves next week, was given 12 months’ notice and will still receive his £1.4m salary.

The legal action threatens to land the lender with potentially billions of pounds in fines

He is the third top executive from the country’s four major banks to step down in the past 18 months from the scandal-hit industry.

Mr Hartzer said: “As CEO, I accept that I am ultimately accountable for everything that happens at the bank.

“And it is clear that we have fallen well short of what the community expects of us, and we expect of ourselves.”

Only the day before, Mr Hartzer had indicated he intended to remain in post, telling staff that the crisis was “not a major issue so we don’t need to overcook this”, according to The Australian newspaper.

Referring to two notorious corporate collapses, he added: “This is not an Enron or Lehman Brothers.”

In response, Mr Maxsted said Mr Hartzer’s reported comments were “very disappointing … and I and the board do not agree”.

Australia’s Prime Minister Scott Morrison had been among those calling for the bank’s board to consider the future of its executives.

Mr Maxsted had previously argued a change at the top would be destabilising for the bank and that he had no intention of retiring.

But in a sharp about-turn on Tuesday, Mr Maxsted said: “We sought feedback from all our stakeholders… it became
clear that board and management changes were in the best interest of the bank.”


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