SINGAPORE - A former senior official of a Swiss private bank was given a 10-year prohibition order from Singapore's top banking regulator for his role in the 1Malaysia Development Berhad (1MDB) scandal.
The scandal, which sparked a massive global probe over billions of dollars misappropriated from the Malaysian state fund, dates to the government of former Malaysian prime minister Najib Razak, which set up 1MDB in 2009.
The Monetary Authority of Singapore said on Monday that Mr Raj Sriram, former deputy chief executive and head of private banking at BSI Bank's Singapore branch (BSIS), has been banned from providing any financial advisory services for a 10-year period starting from Monday.
In addition, Mr Sriram is barred from taking part in the management of any financial advisory firm, or acting as its director, or becoming a substantial shareholder in it for the same period.
MAS' action follows a 24-month conditional warning issued to Mr Sriram in September 2021 by the Commercial Affairs Department, which investigates financial crimes.
CAD's investigation into the banker's role in BSIS' business dealings found that there were reasonable grounds for BSIS to file suspicious transaction reports regarding 1MDB's transactions with its subsidiaries and with a purported subsidiary of the Abu Dhabi-based Aabar Investments.
CAD concluded that BSIS did not file the reports due to Mr Sriram's neglect.
Under the conditional warning, Mr Sriram paid $150,000 to the Singapore Government's Consolidated Fund, which is analogous to a bank account held by the Government.
He also committed to refrain from criminal conduct for a period of 24 months; continue to cooperate with CAD in its 1MDB-related investigations; and not accept any directorship positions or similar positions for a period of four years from Sept 6, 2021.
After CAD's conditional warning, MAS said it reviewed Mr Sriram's conduct as a former regulated representative during his term at BSIS.
The authority concluded that Mr Sriram's conduct warranted a 10-year prohibition order as he held a senior position at BSIS and his neglect contributed to BSIS' failure to file the suspicious transaction reports.
Ms Ho Hern Shin, MAS deputy managing director for financial supervision, said: "BSIS, of which Mr Sriram was deputy-CEO and head of private banking, was a key conduit for tainted funds in the 1MDB debacle."
BSI Bank's Singapore unit was shut in 2016 for its role in the scandal, and the Swiss bank paid a composition penalty of $13.3 million.
"MAS will take to task errant board and senior management members whose failures result in their financial institutions violating laws and regulations," she said.
Mr David Chew, director of CAD, said the suspicious transaction reporting regime is a key pillar of Singapore's approach to anti-money laundering and countering financing of terrorism.
"The Singapore authorities take a serious view of the obligation to file such reports, and strongly urge reporting entities to remain vigilant in detecting and reporting suspicious transactions," he said.
In December 2020, Goldman Sachs Singapore was fined US$122 million (S$165 million) for its role in the 1MDB bond offerings corruption scandal.
Since then, the Singapore authorities have issued stern warnings to other officials of BSIS, including to Mr Kevin Michael Swampillai, former head of wealth management services, and his accomplice, Mr Samuel Wu, owner of Bridge Global Managers.
