The National Australia Bank Ltd (ASX: NAB) share price was hit earlier in the week when AUSTRAC confirmed it's investigating the bank for potential breaches of anti-money laundering legislation.
However, media reports today have revealed that NAB is attempting to combat compliance issues with its Project Apollo.
The NAB share price is currently trading 0.7% lower at $26.58. Three of the big four banks are moving lower today – Australia and New Zealand Banking Group Ltd (ASX: ANZ) is the exception.
What is Project Apollo?
As jointly reported by The Age and The Sydney Morning Herald, NAB's Project Apollo is the bank's response to its potential ongoing compliance issues.
NAB has brought global consulting firm Accenture onboard and beefed up the number of staff working on the project. This follows AUSTRAC commencing a formal investigation into potential breaches.
So, what is Project Apollo exactly? According to reports, the project is an attempt at spearheading problems in identifying high-risk customers banking through ASX-listed NAB.
Financial institutions must assume the responsibility through 'know your customer' obligations outlined in Australia's laws to tackle money laundering and terrorism financing.
While the full details of the project are secretive, sources say Apollo involves examining hundreds of thousands of customer profiles. The objective of the extensive review process is to delete duplicate accounts and remove high-risk customers.
Unsatisfactory checks and balances
Comments made by former NAB staff to The Age raised issues with compliance in the past. The former employees claimed it would be common to find bank accounts with falsified identification documents.
"We would come across profiles set up by government ministers, they were rated low [risk], then you realise these guys are [politically exposed persons] and should be under far more monitoring than usual."
The sources said Australia's second biggest bank is working with technology more than 20 years old. Analysts are allegedly sorting through bank statements manually to determine suspicious activity, the claimed.
NAB has been facing anti-money laundering and counter-terrorism compliance issues since 2017.
The NAB share price still outperformed the ASX
Despite the controversy shrouding NAB, the ASX's benchmark index hasn't managed to keep up. Over the past 12 months, the NAB share price has rallied 30%. Meanwhile, the S&P/ASX 200 Index (ASX: XJO) delivered 18.5% during the same period.
