Ex-CEO of BSI Bank in Singapore sues firm over bonus amid IMDB probe

Swiss bank BSI’s Singapore office at Suntec City Tower 1.
Swiss bank BSI’s Singapore office at Suntec City Tower 1.PHOTO: ST FILE

SINGAPORE (BLOOMBERG) - Mr Hanspeter Brunner, BSI's former Asia chief who is under scrutiny from Singapore prosecutors over the bank's ties with Malaysian state firm 1Malaysia Development Bhd (1MDB), has sued the Swiss private bank after his bonus was frozen.

Mr Brunner's lawsuit alleges that BSI's Singapore unit breached bonus agreements and a separation pact with him, according to documents filed on July 4 in the Singapore High Court. There is no legal basis for BSI to suspend the payment for deferred bonuses due last month, Mr Brunner said in his complaint.

He is among six BSI bankers referred to prosecutors in Singapore after its regulator said in May the bank would lose its licence in "the worst case of control lapses and gross misconduct" in the country's financial sector.

Among BSI's major clients was 1MDB, a subject of money laundering and embezzlement investigations in at least half a dozen countries. A former BSI wealth planner in Singapore became the first banker to be charged in the global probes. 1MDB has denied any wrongdoing. Mr Brunner hasn't been charged.

BSI spokesman Luciano Crobu declined to comment on the lawsuit, as did Mr Brunner's lawyers Ng Lip Chih and Jennifer Sia.

BSI and Swiss national Brunner "mutually agreed" in September that he would retire from the bank, according to court papers. In March, a separation agreement laying out his entitled payments, including deferred bonuses for 2012-2014, was inked and the bank announced his retirement.

Mr Brunner sued after BSI wrote to the 64-year-old on June 24, saying it would freeze a payment of S$722,800 (S$974,500). He said in court papers the bank is also "intending to renege on all of its other payment obligations" totalling US$1 million, scheduled to be paid through June 2018.

Mr Brunner joined BSI in 2009 from RBS Coutts with about 70 colleagues. Coutts and Mr Brunner traded lawsuits after his departure, the bank suing in Singapore for the return of an advance bonus while Mr Brunner claimed in a Zurich complaint that he was wrongfully fired. The firm later settled its lawsuit, according to Singapore court records.