RE 1 MDB -Have ANZ and Gonksi misled the Senate?
by Ganesh Sahathevan
The SMH reported this morning:
ANZ Bank deputy chief executive Graham Hodges has defended ANZ's representatives who have sat on the board of its partially owned Malaysian subsidiary AmBank, which is embroiled in a corruption scandal centring on Prime Minister Najib Razak.
ANZ owns 24 per cent of AmBank and until recently had three board members while former ANZ executives are AmBank's chief financial officer and chief risk officer.
Until late last year, ANZ chief executive Shayne Elliott sat on the AmBank board, while ANZ institutional banking boss Mike Whelan has also stepped down in recent months. ANZ head of HR Suzette Corr remains on the board of AmBank. Mr Hodges said he will soon join the AmBank board.
Mr Hodges was grilled over ANZ's alleged knowledge of more than $US1 billion flowing into the AmBank accounts of the Malaysian PM by ALP Senator Deborah O'Neill at a parliamentary inquiry on the impairment of customer loans.
"This pall is cast across the entire banking sector and in particular the ANZ Bank," Senator O'Neill told the inquiry.
Mr Hodges said the bank was limited in what it could do to address the AmBank scandal because it was only a part owner of the bank.
"It's a more nuanced issue to be honest. Clearly the directors on that board are not allowed to talk about what's going on. We don't control that bank," Mr Hodges said.
There are a number of issues that are obviously misleading,and would be obvious even if one has not been awarded the University Medal at UNSW for being best student at the Law School.
First, ANZ has a duty to report any wrong doing to authorities in Malaysia and Australia, regardless of control. To argue otherwise wold contradict the purpose and intent of in particular AML/CTF laws in Malaysia and in Australia.As previously reported on this blog, Australian AML/CTF laws have extra-territorial effect and apply to the conduct of individuals.To argue that banking secrecy laws prevent the reporting of a crime or other breach of the law is not an argument that would hold water in even Vanuatu,let alone Australia.
Second, the extent of ownership is irrelevant. All foreign banks with branches in Malaysia do so via wholly-owned locally incorporated subsidiaries, and they too are subject to the same rules and regulations on secrecy that ANZ managers at AMMB are subject to.Put in another way, they are not exempt from local laws because their are wholly-owned.
Third, ANZ controls AMMB management, accounting and other administrative and policy functions in what ANZ describes as a partnership. The assertion,"We don't control that bank";is clearly misleading.
The issue is "nuanced" , but not in the way ANZ and Graham Hodges would like the Senate to believe.
END
The SMH reported this morning:
ANZ Bank deputy chief executive Graham Hodges has defended ANZ's representatives who have sat on the board of its partially owned Malaysian subsidiary AmBank, which is embroiled in a corruption scandal centring on Prime Minister Najib Razak.
ANZ owns 24 per cent of AmBank and until recently had three board members while former ANZ executives are AmBank's chief financial officer and chief risk officer.
Until late last year, ANZ chief executive Shayne Elliott sat on the AmBank board, while ANZ institutional banking boss Mike Whelan has also stepped down in recent months. ANZ head of HR Suzette Corr remains on the board of AmBank. Mr Hodges said he will soon join the AmBank board.
Mr Hodges was grilled over ANZ's alleged knowledge of more than $US1 billion flowing into the AmBank accounts of the Malaysian PM by ALP Senator Deborah O'Neill at a parliamentary inquiry on the impairment of customer loans.
"This pall is cast across the entire banking sector and in particular the ANZ Bank," Senator O'Neill told the inquiry.
Mr Hodges said the bank was limited in what it could do to address the AmBank scandal because it was only a part owner of the bank.
"It's a more nuanced issue to be honest. Clearly the directors on that board are not allowed to talk about what's going on. We don't control that bank," Mr Hodges said.
There are a number of issues that are obviously misleading,and would be obvious even if one has not been awarded the University Medal at UNSW for being best student at the Law School.
First, ANZ has a duty to report any wrong doing to authorities in Malaysia and Australia, regardless of control. To argue otherwise wold contradict the purpose and intent of in particular AML/CTF laws in Malaysia and in Australia.As previously reported on this blog, Australian AML/CTF laws have extra-territorial effect and apply to the conduct of individuals.To argue that banking secrecy laws prevent the reporting of a crime or other breach of the law is not an argument that would hold water in even Vanuatu,let alone Australia.
Second, the extent of ownership is irrelevant. All foreign banks with branches in Malaysia do so via wholly-owned locally incorporated subsidiaries, and they too are subject to the same rules and regulations on secrecy that ANZ managers at AMMB are subject to.Put in another way, they are not exempt from local laws because their are wholly-owned.
Third, ANZ controls AMMB management, accounting and other administrative and policy functions in what ANZ describes as a partnership. The assertion,"We don't control that bank";is clearly misleading.
The issue is "nuanced" , but not in the way ANZ and Graham Hodges would like the Senate to believe.
END
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