Monday, May 17, 2021

Singapore fines Swiss Bank J. Safra Sarasin for breaching anti-money laundering laws


The Singapore branch of a Swiss-based private bank has been fined $1 million for failing to comply with measures to counter money laundering and terrorist financing.

The penalty was imposed on Bank J. Safra Sarasin (BJS) for breaches between March 2014 and September 2018. These included failing to establish the source of its customers’ funds by appropriate and reasonable means.

In many cases, BJS relied on customers’ representations without corroboration.

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The bank also failed to adequately inquire into unusually large or abnormal patterns of customer transactions that had no obvious economic purpose.

The Monetary Authority of Singapore (MAS) said yesterday that the lapses arose during the process of signing on customers and in monitoring their business relations, which put BJS at higher risk of being used as a conduit for illicit activities.

BJS has been ordered to appoint an independent party to validate the effectiveness of its measures and report the findings to the MAS.

The regulator noted the penalty amount took into consideration BJS’ actions to address deficiencies that it identified.

Breaches of measures to prevent money laundering and terrorist financing carry a maximum fine of $1 million for each offence.

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Ms Loo Siew Yee, assistant managing director of policy, payments and financial crime at MAS, said: “Financial institutions engaging in private banking business must be vigilant in guarding against the risk of dealing with illicit wealth.

“Given the potential complexity of private bank clients’ profiles, it is particularly important that clients’ representations regarding their source of wealth and funds are scrutinised and corroborated by objective evidence.”

Update: 16/4/2021
Bank J. Safra Sarasin says
No allegations exist that the Singapore branch was involved in actual money laundering activities. The fine of approx. CHF 680’000 (SGD 1 million) relates to historical issues (2014-2018) regarding the proper documentation of client relationships and transactions under local anti-money laundering rules and related procedural issues. Compliance with all applicable laws, rules and regulations in the markets in which we operate is of the highest priority for Bank J. Safra Sarasin. Accordingly, as stated by MAS, the Branch immediately took remediation actions to address the deficiencies that were identified.


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