An Australian teenager's money laundering scam has reached $200,000 because of alleged failure by banks to stop the credit card scheme despite efforts by the teen's mother.

Out of her frustration by inaction of the banks the mother from New South Wales filed a lawsuit before the Supreme Court against Commonwealth Bank, Australia New Zealand Bank, Westpac and National Australia Bank, the Sydney Morning Herald reports.

The scheme started in 2007 when her son, then 14, sold expensive items such as laptops, mobile phones and watches on eBay without delivering the merchandise. The scam earned for the teen over $6,000 a day, which gave him enough money to live the high life by staying at $4,300 a night penthouse suites in Sydney Harbour and hiring limousines to go around.

She claims the banks did not heed her call to stop allowing her sons to open accounts and debit cards, citing the Privacy Act. When he turned 19, the son opened an account with Commonwealth Bank.

"He strolled into a branch one day and, armed with a birth certificate and a friend over the age of 18 who claimed to be his guardian, they gave him an account. Once he secured that, he was able to accumulate cheque and Visa debit accounts with many other financial institutions including Westpac, the Bank of Queensland, ANZ, Credit Union Australia and the Hume Building Society," The Sydney Morning Herald quoted the mother.

She turned him over to the police 15 times which led to his detention in juvenile centres and not committing any credit card crime the past year. NSW Police Senior Constable Dave Henderson helped her put the erring teenager in jail by charging him in 2008 with 20 incidents of fraud.

The mother recalled that except for the police officer, others she had contacted such as teachers, principals, counselors, doctors, travel agencies, car rental firms, hotels, the Australian Securities and Investments Commission, the banking ombudsman and MPs pointed her back to the banks.

"To this day, they refuse to acknowledge it was their accounts being used to launder money, and their overdrafts to commit more crime," she said, which led her file the lawsuits.

The banks said they will answer her charges in court, but refused to comment on the case.

Meanwhile, Sydney police rearrested over the weekend a 32-year-old Haymarket woman over a $30-million credit card scam. She and a 47-year-old Ashbury man were arrested on Tuesday although she got out on bail.

During the first arrest, they confiscated 12,000 blank credit cards from the pair. On her second arrest while at a Haymarket financial institution, they officer seized $30,000 cash, jewelry worth over $140,000 from two safety deposit boxes she maintained in the bank.