Banks have been under fire over their handling of money laundering, as well as over how they handle clients and employees.
A Senate inquiry into the banks has heard from whistleblowers who allege the banks were not only lax in their risk-management but also lax in the way they dealt with clients and staff.
The banks have also been under scrutiny for the way in which they handle customer and employee complaints.
While the banks’ board has acknowledged that it has improved its risk-and-control procedures, it is still unclear how much of that has come from improved training and how much from improved oversight.
This week, the Australian Financial Commission has released a new report on the banks, which found that the banks are not doing enough to improve their processes and are not meeting their obligations to staff and customers.
The ACCC also highlighted some of the problems in the banks risk-based approach to risk.
For example, the ACCC said that in some cases, banks were “not sufficiently trained” in how to assess the risks they faced in a particular area of their business.
While banks have been required to meet a series of targets over the last four years, the banks have so far failed to meet those targets, the report found.
Some of the banks also failed to provide clear and consistent risk-reduction guidance and information, the review found.
“In some cases the banks do not provide information on how they meet their targets, or how to do so in a timely manner,” the ACCCP said in a report released in March.
In a separate report released earlier this month, the watchdog also highlighted how the banks failed to keep customer information confidential.
“The ACCC has highlighted the banks lack of effective risk management, including insufficient information and communication about risk, inadequate risk management training and the lack of clear guidance on how to manage risk,” the watchdog said.
“It has also identified a number of examples where banks failed the banks responsibility to provide consistent risk management information and training.”
In the latest report, the bank reviews were conducted by the ACCCE.
The bank reviews included a series to assess risk-taking, risk-consumption and risk management by the banks and to determine the banks best practices in the areas where the banks had weaknesses.
In addition, the reviews looked at the performance of the bank by other regulators and the performance and risk of other financial institutions, including private and public sector financial institutions.
The review also identified five areas where a number “critical flaws” were identified.
These included inadequate risk-analysis and information sharing, poor risk-guidance for clients and their customers and inadequate risk analysis and risk-structure for staff.
It also highlighted the bank’s failure to ensure that its staff and clients were trained in risk-risk management and effective risk-assessment.
“Given the significant risk to the financial system, the commission has found that a number critical flaws in the bank risk- and-risk-assurance system and the risk-strategy in place may pose a serious risk to Australia’s financial system,” the review said.
It said that banks had not yet been fully transparent on the details of their risk assessment and risk strategy.
The report also highlighted a number issues with the banks customer and compliance compliance processes, as the bank did not disclose how many of its customers and customers’ compliance with the laws were breached.
“We have been encouraged by the progress made in improving the bank customer and risk compliance processes in the last few years,” the bank said in the report.
The commission also found that banks did not have a strong risk-level framework in place.
It recommended that the ACCCs risk-ranking process should be improved and that it should be made available to the public.
The regulator also recommended that banks be required to disclose more information about their risk factors to their customers.
It added that “a better understanding of risk-related risks and risks associated with the banking industry is vital to ensure the safety of the financial sector.”