Online gambling firm International All Sports is blaming sloppy controls and mismanagement at Commonwealth Bank of Australia for a $19 million loss racked up by one of its branch managers.
The company is defending a $17 million claim by the bank which is attempting to recover funds stolen from a branch in Karratha.
The branch manager embezzled the money without detection over a five-year period before turning himself into police. He is currently serving a five-year prison sentence.
In its defence, IAS says the loss suffered by the CBA "is due totally to their own ineptitude."
The firm has lodged a substantial counter claim against the CBA for mismanagement.
IAS chairman, Barry Coulter says: "The fundamental failure of the bank was its failure to detect the fraud and protect its customer in the circumstances where the stolen funds were internally transferred from its Karratha branch to the IAS account at its Darwin branch."
Finextra first highlighted the risks facing banks from the spread of Internet gambling in our news analysis section last month: Roll the dice