Australia's financial intelligence and regulatory agency, AUSTRAC, has launched civil penalty proceedings in the Federal Court against the Commonwealth Bank of Australia for serious and systemic non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.AUSTRAC acting CEO Peter Clark said that this action follows an investigation by AUSTRAC into CBA's compliance, particularly regarding its use of intelligent deposit machines. AUSTRAC's action alleges over 53,700 contraventions of the AML/CTF Act, with each omission in theory carrying an A$18 million fine - adding up to almost $1 trillion. In summary AUSTRAC alleges:  CBA did not carry out any assessment of the money laundering and terrorism financing risk of IDMs before their rollout in 2012, in breach of the bank's own ATF/CTF rules. Despite being warned internally and externally, CBA took no steps to assess the ML/TF risk until mid-2015 - three years after they were introduced. For a period of three years, CBA did not comply with the requirements of its own AML/CTF program relating to monitoring transactions on 778,370 accounts. CBA failed to give 53,506 threshold transaction reports to AUSTRAC on time for cash transactions of $10,000 or more through IDMs from November 2012 to September 2015. These late TTRs represent approximately 95 per cent of the threshold transactions that occurred through the bank's IDMs from November 2012 to September 2015 and had a total value of around A$624.7 million. The bank failed to report suspicious matters either on time or at all involving transactions totalling over $77 million. Even after CBA became aware of suspected money laundering or structuring on CBA accounts - both through internal monitoring and as a result of law enforcement agencies' information - it did not monitor its customers to mitigate and manage ML/TF risk, including the ongoing ML/TF risks of doing business with those customers. In a document lodged in the Federal Court, AUSTRAC outlined several instances where known money laundering syndicates were allowed to continue their operations unreported, allowing millions of dollars in cash to be deposited into CBA accounts and then transferred offshore almost immediately.Mr Clark said that today's action should send a clear message to all reporting entities about the importance of meeting their AML/CTF obligations.If this news came as a shock to Clark, given the pivotal role he has held in launching the Fintel Alliance only a few months ago, he wasn't showing it. (The alliance is an intelligence sharing arrangement between business, law enforcement agencies and regulators that counts CBA as one of its founding members.)An AUSTRAC spokeswoman declined to suggest the magnitude of any penalty. Media outlets, however, were quick to point out that the agency's previous biggest successful AML case in Australia was played out earlier this year against Tabcorp Holdings, which involved a mere 108 alleged breaches, yet Tabcorp paid A$45 million in fines. This remains biggest civil penalty in Australian corporate history.CBA responded to news of AUSTRAC's court action via two very carefully worded statements, including these assertions:"We have been in discussions with AUSTRAC for an