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Swiss private bank fined $1m for breaching anti-money laundering rules

Swiss private bank fined $1m for breaching anti-money laundering rules

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

The fine was imposed on Bank J. Safra Sarasin for serious breaches between March 2014 & September 2018.

In particular, the bank failed to establish the source of the funds of its customers by appropriate as well as reasonable means. 

In most cases, Bank J. Safra Sarasin depended on the representations of customers without any proper validation. The bank also failed to inquire into exceptionally large or irregular patterns of customer transactions that had no apparent economic purpose.

The MAS (Monetary Authority of Singapore) stated on Wednesday that the faults arose during the signing process on customers as well as in the ongoing monitoring of their business relations with customers, which put BJS at a much higher risk of being utilized as a channel for illegal activities.

Bank J. Safra Sarasin has been instructed to appoint an independent party to prove the effectiveness of its measures as well as report the findings to the Monetary Authority of Singapore.

The official noted the amount of penalty considered the actions of BJS to address the faults that it identified. Breaches of measures to stop terrorist financing and money laundering involves a maximum fine of $1 million for each felony.

Ms Loo Siew Yee, assistant MD of policy, payments and financial crime, MAS, stated that the financial institutions entering into private banking business should be attentive in guarding against the high risk of dealing with illegal wealth.

Yee added that given the potential intricacy of profiles of private bank customers, it is very important that customers’ representations regarding their source of wealth as well as funds are inspected and corroborated by objective proof.

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Nandita Bhardwaj

Nandita holds a management degree with specialization in marketing, and boasts of a short-term experience in the field of recruitment. Following her passion for writing however, she decided to pursue a career in the field of content development. Presently, Nandita pens down news pieces for, spanning the verticals of business, finance, and technology.