MAS Fines Ten Banks $21 Million for Breaching Anti-Money Laundering Rules

A number of financial entities were found guilty of involvement in Malaysia’s state fund scandal.

Singapore’s central bank has announced having fined both Credit Suisse and United Overseas Bank (UOB) a total of S$1.6 million ($1.15 million). The banks were found guilty of breaches of anti-money laundering rules in transactions that were connected to the Malaysian state fund 1MDB scandal.

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The Monetary Authority of Singapore (MAS) fined Credit Suisse S$700,000 ($504,347) and UOB S$900,000 ($648,437) following the conclusion of a two year long investigation which revealed several control lapses and the aforementioned anti-money laundering related breaches. The MAS has fined eight additional banks for similar transgressions, collecting from them a total of S$29.1 million ($21 million).

Along with the fines, Singapore also shut down the local branches of BSI Bank and Flacon Bank for weaknesses in money laundering control and inappropriate conduct by the senior management. Additionally, millions of dollars were frozen in their bank accounts, and private bankers were charged.

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The announcement stated that though it had not detected any prevalent control weaknesses, it did find that the banks were lax “…in conducting due diligence on customers and inadequate scrutiny of customers’ transactions and activities.”

Malaysia’s Prime Minister Najib Razak’s 1MDB state fund, of which he was the chairman of the advisory board, was the subject of six money laundering investigations that included Switzerland, the United States of America, and Singapore itself. The former chairman denied his involvement in any wrongdoing.

Credit Suisse responded by saying: “Credit Suisse takes a very serious view of our obligations in the prevention of money laundering and is firmly committed to upholding the high standards of the Singapore financial center.”

UOB stated its acceptance of the findings given by the MAS investigation: “We have instituted measures to address the areas of concern, including enhancing our training programme to raise risk and control awareness among our staff.”

Recently, Finance Magnates covered the MAS having signed an agreement with two French regulators the Autorité de Contrôle Prudentiel et de Résolution (ACPR) and the Autorité des Marchés Financiers (AMF). The contract is said to enhance the two countries’ relations with an emphasis on regulation and fintech related symbiosis.

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