Updated 3 March, 14:15 with comment from CBA
The Commonwealth Bank has reached an out-of-court settlement with a US-based not-for-profit organisation in a lawsuit linked to an Australian criminal case involving former IT executives at the bank.
US organisation Ace Foundation in May last year sued the bank in a Californian court. The Commonwealth Bank was accused of freezing funds that belonged to the foundation.
Those funds had been advanced to two former CBA employees, Jon Waldron and Keith Hunter, who were charged by NSW Police with accepting kickbacks in return for awarding contracts to US software company ServiceMesh (now a subsidiary of CSC).
Police have claimed that the foundation was used to channel the alleged kickbacks to the duo.
(In an effort to seek distance from the ongoing Australian controversy, the Ace Foundation has been replaced by a new not-for-profit called the CoreTech Foundation. The foundation has rejected any wrongdoing on its part.)
The Ace Foundation has previously said it engaged Waldron and Hunter as consultants to work on charitable, technology-based projects and advanced the funds to the two between May and December 2014 to cover any costs they incurred.
The US-based civil action against the bank was in January removed from the Los Angeles Superior Court to the federal US District Court after an application by lawyers representing CBA.
The two parties have now reached a settlement and are in the process of executing a formal written agreement. It is anticipated the case will be dismissed within a fortnight.
"In May 2015 Ace Foundation filed legal proceedings against Commonwealth Bank in California relating to funds in bank accounts of the two former employees that had been frozen on the application of the NSW Crime Commission," a spokesperson for the Commonwealth Bank told Computerworld.
"Commonwealth Bank can confirm that a notice of settlement has been filed in these proceedings. These matters are related to the ongoing criminal proceedings in Australia."
The NSW Crime Commission's civil case was launched in the NSW Supreme Court in mid-2015.
The criminal case is scheduled for a mention at Sydney’s Downing Centre on 3 March.
"Commonwealth Bank has no tolerance for any illegal activity by any employee and in February 2015 we reported certain suspicious activity to NSW Police," the bank's spokesperson said.
"In March 2015 two former Commonwealth Bank employees were arrested and charged by NSW Police and we continue to fully cooperate with the authorities as these proceedings progress through the courts."