Bendigo and Adelaide Bank has revealed systemic deficiencies in its anti-money laundering and counter-terrorism financing controls following a Deloitte investigation, committing to comprehensive remediation efforts.
- Deloitte investigation exposed AML/CTF control weaknesses from 2019 to 2025
- Deficiencies found across risk assessment, customer due diligence, and transaction monitoring
- Issues extend beyond one branch, indicating systemic risk management failures
- Bank commits to fully funding remediation and enhancing compliance frameworks
- Ongoing engagement with AUSTRAC, APRA, and ASIC promised
Background of the Investigation
In August 2025, Bendigo and Adelaide Bank Limited (ASX – BEN) initiated an independent review by Deloitte after identifying suspicious activity suggestive of money laundering at one of its branches. This prompted the bank to report the matter to AUSTRAC and law enforcement authorities. Deloitte’s investigation spanned six years, from August 2019 to August 2025, aiming to uncover the nature and extent of any anti-money laundering (AML) and counter-terrorism financing (CTF) deficiencies.
Findings Reveal Systemic Weaknesses
The Deloitte review uncovered significant shortcomings not only at the implicated branch but across the bank’s broader AML/CTF risk management framework. Key areas of concern included inadequate risk assessments, insufficient enhanced customer due diligence, and ineffective oversight mechanisms. Particularly troubling was the deficient transaction monitoring program, which failed to cover many critical risk indicators that could detect illicit activities.
Bank’s Response and Commitment
The Board of Bendigo and Adelaide Bank expressed deep disappointment with the findings but reaffirmed its commitment to rectifying all identified issues. It has pledged to fully fund an uplift program designed to overhaul systems, processes, and governance frameworks to ensure full compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006. The bank also committed to maintaining transparent communication with the market and regulators, including AUSTRAC, APRA, and ASIC, as remediation progresses.
Implications for the Bank and Investors
This disclosure highlights the challenges financial institutions face in managing evolving AML/CTF risks and the regulatory scrutiny that follows any lapses. While the full financial impact remains uncertain, the bank’s proactive stance on remediation and cooperation with regulators may help mitigate longer-term reputational damage. Investors will be watching closely for updates on remediation costs, regulatory feedback, and any potential enforcement actions.
Looking Ahead
Bendigo and Adelaide Bank’s case serves as a cautionary tale about the importance of robust compliance frameworks in the banking sector. The unfolding remediation journey will test the bank’s ability to restore confidence among regulators, customers, and shareholders alike.
Bottom Line?
Bendigo Bank’s full-scale remediation marks a critical turning point in its AML/CTF compliance journey.
Questions in the middle?
- What specific remediation measures will the bank implement to address identified deficiencies?
- How will regulators respond, and could enforcement actions or penalties follow?
- What impact will remediation costs and reputational risks have on the bank’s financial performance?