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Westpac served with yet another class action

The Westpac Banking Corp (ASX: WBC) share price was sold off again on Thursday, leading to its shares falling to a decade low of $17.74.

Unfortunately for shareholders, Westpac’s shares could come under pressure again on Friday.

This follows heavy declines on Wall Street overnight and the announcement that it has been hit with a new class action this morning.

What did Westpac announce?

This morning Westpac confirmed that it has been served with a class action by Johnson Winter & Slattery.

This class action is on behalf of certain shareholders who acquired an interest in Westpac securities or equity swap confirmations between December 16 2013 and November 19 2019 inclusive.

According to the release, the claim relates to market disclosure issues connected to Westpac’s monitoring of financial crime over the relevant period and matters which are the subject of the AUSTRAC proceedings.

AUSTRAC is pursuing Westpac through the court for beaching anti-money laundering and counter terrorism laws 23 million times. These breaches allegedly include the failure to carry out appropriate customer due diligence on transactions to the Philippines and South East Asia that have known financial indicators relating to potential child exploitation risks.

What now?

Westpac notes that the Johnson Winter & Slattery class action covers a similar subject matter to the claim filed by Phi Finney McDonald, which was announced to the market in December 2019.

The banking giant advised that the claim does not identify the amount of any damages sought and it will be defending the claim.

This is the second class action to be filed against Westpac in the last six weeks. At the start of February Westpac announced that Rosen Law Firm has filed a class action lawsuit against it in the United States on behalf of purchasers of its securities between November 11 2015 and November 19 2019 inclusive.

This claim seeks to recover damages of an unspecified amount and also relates to market disclosure issues connected to Westpac’s monitoring of financial crime over the period.

It looks like Westpac’s legal team is going to have a very busy year.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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