Client Profile
At a Glance
🚨 The Challenge
One of Australia's largest banks faced an IBM software audit claiming AUD 18 million in non-compliance fees. The bank's IT environment included critical banking applications, customer relationship platforms, and secure cloud environments.
- Alleged violations related to sub-capacity licensing
- Misconfigured virtualised environments flagged by IBM
- Decentralised operations with limited software usage visibility
- Critical banking applications requiring uninterrupted service
- Regulatory compliance obligations adding complexity
- Reconciling compliance issues across a vast IT estate
✅ The Outcome
Redress Compliance reduced the bank's financial liability by 97% — from AUD 18 million to just AUD 540,000.
- Final settlement of AUD 540,000 (additional licences only)
- No penalties incurred — settlement covered genuine needs only
- AUD 17.46 million in alleged non-compliance eliminated
- Zero disruption to critical banking services
- Centralised licence management implemented
- Real-time monitoring tools deployed across the estate
💰 Audit Claim Resolution
The final AUD 540,000 settlement covered only the cost of additional licences required for specific deployments — with no penalties incurred. The remaining AUD 17.46 million was eliminated through corrected sub-capacity calculations, virtualisation revalidation, licence reallocation, and challenge of IBM's inflated metrics.
Our Process
Redress Compliance provided end-to-end IBM audit defence for the bank, working closely with IT, operations, and procurement teams to systematically dismantle IBM's AUD 18 million claim while ensuring uninterrupted service delivery to the bank's customers.
Audit Analysis & Preparation
Initiated a detailed review of IBM's audit report, uncovering discrepancies in the licensing metrics and entitlement mapping. Assessed historical agreements, entitlements, and usage data to establish compliance baselines. Identified where IBM's calculations deviated from the bank's actual deployment reality and contractual terms.
Data Collection & Validation
Collaborated with the bank's IT and operations teams to gather precise data from virtual servers, cloud platforms, and physical hardware. Validated sub-capacity usage data with a particular focus on high-demand banking applications and virtualised workloads. Identified instances of over-provisioned and underutilised licences — creating opportunities for optimisation and reallocation to close compliance gaps.
Strategic Negotiations with IBM
Engaged directly with IBM's audit team to dispute inflated claims, presenting corrected data and compliance justifications. Highlighted the bank's commitment to regulatory compliance and cybersecurity to strengthen the negotiation position. Secured significant concessions from IBM by demonstrating proactive efforts to address licensing challenges and presenting alternative, defensible interpretations of IBM's licensing rules.
Optimisation & Compliance Management
Developed a licence optimisation strategy, reallocating underutilised licences to address remaining compliance gaps without unnecessary additional purchases. Designed a compliance framework to monitor and manage software usage in real time, preventing future discrepancies. Provided training to IT and procurement teams on IBM's licensing rules and best practices for ongoing licence governance.
"The IBM audit posed a significant risk to our operations and finances, but Redress Compliance's expertise saved us millions. Their approach was efficient and left us better prepared to manage licensing in the future. They delivered exactly what we needed."
Key Takeaways
IBM audits in highly regulated industries like banking carry additional stakes — not only financial exposure, but operational continuity and regulatory compliance obligations. IBM's audit methodology frequently overestimates licence requirements by miscalculating sub-capacity licensing in complex virtualised environments and failing to account for existing entitlements correctly. In this case, 97% of IBM's AUD 18 million claim was eliminated once accurate deployment data was collected, sub-capacity calculations were corrected, and underutilised licences were reallocated. Financial institutions facing IBM audits should engage independent licensing expertise early to protect both their financial position and their ability to deliver uninterrupted customer service throughout the audit process.
Facing an IBM Audit?
Redress Compliance has defended hundreds of organisations against IBM licence audits — routinely reducing claims by 80–100%. Our independent advisory ensures you only pay for what you legitimately owe, with no vendor ties or conflicts of interest.
📖 Related Case Studies & Resources
- Case Study: IBM Audit Defense for a German Automotive Company
- Case Study: IBM Audit Defense for a US University
- Case Study: IBM Audit Defense for a US Medical Hospital
- Case Study: IBM Audit Defense for a Large US Retailer
- IBM Licensing Case Studies: Eliminating Risk & Cutting Millions
- Enterprise Guide to IBM Licence Audits
- IBM PVU Licensing: A Practical Guide
- IBM ILMT: Sub-Capacity Licensing Advisory
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Learn more →Fredrik Filipsson
Fredrik Filipsson brings 20+ years of experience in enterprise software licensing, having worked directly for IBM, SAP, and Oracle before co-founding Redress Compliance. He has defended hundreds of organisations against IBM licence audits across banking, financial services, automotive, manufacturing, pharmaceutical, and technology sectors — routinely eliminating or dramatically reducing compliance claims. Redress Compliance maintains complete vendor independence — no commercial relationships or referral fees from any software vendor.