The Commonwealth Bank has agreed to pay the largest fine in Australian corporate history for breaches of anti-money laundering and counter-terrorism financing laws.

CBA will pay $700 Million plus AUSTRAC's legal costs after the agency alleged serious and systemic failures to report suspicious deposits, transfers, and accounts.  The breaches allowed millions of dollars to flow to the international drug trade.  In addition, CBA has already spent more than $400 Million on upgrading its systems and processes, and retraining its people to ensure laws are obeyed.  It's been a costly week.

Commonwealth Bank admits to missing the ten-day deadline for reporting more than 53,000 transactions of more than $10,000 through its "intelligent deposit machines" (IDMs).  AUSTRAC uses that time frame to determine if these large transactions are going to crime gangs or terrorist networks.

CBA also copped to failing to adhere to the risk management requirements of those IDM machines on 14 occasions, the late filing or no filing of 149 "suspicious matter" reports, and the ongoing breaches of customer due diligence requirements in respect of 80 customers.

Prior to this, Australia's biggest fine for money laundering breaches was last year's $45 million paid by wagering company Tabcorp for 84 failures to report suspicious transactions.