Thursday, October 29, 2020

Swiss regulator condemns Julius Baer for serious money laundering failures

-

Switzerland’s financial markets watchdog has found serious shortcomings in Julius Baer’s efforts to combat money laundering over nearly a decade, appointing an auditor and prohibiting the bank from doing large deals.

Watchdog FINMA said the failings between 2009 and early 2018 were connected to alleged cases of corruption linked to Venezuelan oil company PDVSA and world soccer body FIFA, resulting in enforcement proceedings which FINMA had now concluded.

FINMA had conducted inspections at several Swiss banks in relation to these cases and appointed an agent to investigate Julius Baer in 2017.

It broadened its probe into Switzerland’s third-largest listed bank in 2018 following the arrest of a Baer client adviser in the United States and in response to events in Venezuela.

- Advertisement -

FINMA said the bank had to take effective measures to identify client advisers whose portfolio carries a high money-laundering risk and also adjust its pay and disciplinary policy to help avoid unreasonable risk-taking.

It barred Baer from large and complex acquisitions until it fully complied with the law.

An independent auditor would supervise the implementation of the measures, FINMA said.

Julius Baer acknowledged FINMA’s conclusions in a statement.

- Advertisement -

“We accept FINMA’s findings and regret the shortcomings identified in our business with Latin American clients. This is not compatible with the risk culture that we are striving to achieve,” Julius Baer Chairman Romeo Lacher said.

Julius Baer said it had taken comprehensive measures to strengthen its compliance and risk culture – progress FINMA acknowledged in its statement – and would “rapidly and resolutely” enforce implementation of the measures.

The bank last year appointed company insider Philipp Rickenbacher as chief executive, replacing Bernard Hodler, its former risk chief who took over when predecessor Boris Collardi abruptly left in 2017 to run unlisted rival Pictet.

Pictet, where Collardi is a managing partner and joint head of wealth management, declined to comment. Picted also said Collardi, who became Baer’s CEO in 2009 and oversaw its rapid growth, declined to comment.

Julius Baer has said under its new CEO its focus would shift from attracting new money to sustainable profit growth. It also installed new leadership in Latin America in December 2017 and closed its business in Panama and Venezuela.

The bank’s shares fell 2% in early trading.

MUST READ

Nigerian court declines to issue international arrest warrant for fugitive ex-Petroleum Minister in corruption case

The Abuja Division of the Federal High Court, on Wednesday, refused an application by the Economic and Financial Crimes Commission, EFCC, for an arrest...

South Korea’s former Vice Justice Minister sentenced to jail for bribery and sexual favors

Former Vice Justice Minister Kim Hak-eui, the figure at the center of one of Korea’s biggest political sex scandals, was placed under pretrial detention...

Beam Suntory Inc. fined $19.6 million in foreign bribery case

Beam Suntory Inc. (Beam), a Chicago-based company that produces and sells distilled beverages, has agreed to pay a criminal monetary penalty of $19,572,885 to...

Julius Baer to deny two former CEOs their bonuses over money laundering scandal

Julius Baer will withhold millions of francs in bonuses from its former chief executives Boris Collardi and Bernhard Hodler, as a result of a...

Goldman Sachs executives to cover part payments of $3 billion fines in 1MDB scandal

Nine current or former Goldman Sachs executives, including CEO David Solomon, will have to pay back hundreds of millions of dollars in compensation over...

Subscribe For More

Get our daily notification on the latest financial crimes news around the World

Advertisement
Advertisement

Latest News

This Week

Swiss court upholds money-laundering conviction of ex-Ukrainian lawmaker Martynenko

A Swiss court has upheld the conviction of former Ukrainian lawmaker Mykola Martynenko for laundering via Swiss banks millions of dollars worth of kickbacks...

Hong Kong fines Goldman Sachs $350 million over 1MDB scandal

Goldman Sachs ignored multiple red flags over the multibillion-dollar fundraisings it arranged for state fund 1Malaysia Development Berhad, Hong Kong’s financial regulator said on...

Greek ex-minister Tsochadzopoulos, wife sentenced for money laundering

Former minister Akis Tsochadzopoulos, his wife and his cousin were found guilty of money laundering by a criminal appeals court on Tuesday. Each was served...

Former Malawi minister sentenced to six years in prison over passport corruption scandal

A court in Malawi’s capital Lilongwe on Thursday sentenced a former home minister to six years in prison after he was found guilty in...
Advertisement

Adblock Detected!

Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by whitelisting our website.

Enable Notifications    Ok No thanks