“It’s not that things don’t go wrong,” Mr Ward told the House Economics Committee in Canberra on Friday.
Mr Ward said the business had reduced its growth ambitions to better cope with heightened levels of compliance.
“It is certainly complicated to run a large financial business and that is the reason we have down-scaled the business significantly,” he said.
Westpac’s former consumer chief George Frazis said the Bank of Queensland, where he is now CEO, had “zero tolerance” for non-compliance with anti-money laundering legislation.
AUSTRAC in a lawsuit accused Westpac of breaching Australia’s anti-money laundering and counter-terrorism finance laws 23 million times this week.
The lawsuit also accused the bank of failing to update its systems to properly vet thousands of transactions that could be linked to child exploitation and live child sex shows in the Philippines and other parts of south-east Asia.
Mr Frazis said the bank had lifted its systems following a review by AUSTRAC last year and it had reported 2000 suspicious matters to the regulator in the past year. Seperatley, ten staff had been dismissed from the bank as a result of misconduct.
“You have no choice but to continue improving your processes in this area,” he said.
Bendigo and Adelaide Bank CEO Marnie Baker said the sector should work together to develop anti-money laundering measures because there was no competitive advantage.
Up to 20 staff had been dismissed from the bank for other misconduct matters over the past 12 months she said.
Head of the Australian Prudential Regulation Authority, Wayne Byers, will appear before the committee on Monday. MPs will decide if they will formally call Westpac to appear by Wednesday.
The committee’s deputy chair, Labor MP, Andrew Leigh said he would be following up on reports that a Westpac compliance officer who reported the breach has been fired.
“If true, this would be a shocking turn of events,” he said. “Because APRA has a direct interest in banks complying with the rules, I’ll be asking them whether they intend to take any action about it, and what implications it could have for employees who speak out.”
Eryk Bagshaw is an economics correspondent for The Sydney Morning Herald and The Age, based at Parliament House in Canberra