Two more banks were hit with fines yesterday as the authorities here wrapped up a wide-ranging money-laundering probe linked to the scandal-hit 1Malaysia Development Berhad (1MDB) state fund.
The fines announced yesterday mean a total of $29.1 million in penalties has been imposed on eight errant banks since the two-year probe began of 1MDB- related transactions known to date.
In what has been described as the most extensive review the Monetary Authority of Singapore (MAS) has undertaken, its managing director Ravi Menon noted that the review holds key lessons for both MAS and financial institutions.
"MAS has... taken unprecedented enforcement actions," he said. "Financial institutions have increased their risk awareness and strengthened controls. Our financial industry is in a better position today."
The review has uncovered transactions involving numerous shell companies and individuals operating in the United States, Singapore, Switzerland, Hong Kong, Luxembourg and Malaysia.
The latest to be hit were United Overseas Bank (UOB), which was fined $900,000, and Switzerland's Credit Suisse Group, which was fined $700,000 - both for breaches of anti-money laundering requirements and control lapses. MAS said it found weaknesses in their customer due diligence methods and inadequate scrutiny of transactions and activities, but it did not detect pervasive control weaknesses.
Swiss financial watchdog Finma sent Credit Suisse a written reprimand over shortcomings in its anti-money laundering processes.
Fines had earlier been imposed on BSI Bank, Falcon Private Bank, DBS, UBS, Standard Chartered and Coutts. In addition, BSI Bank and Falcon Private Bank in Singapore were shut down last year due to serious failures in anti-money laundering controls and improper conduct by senior management.
Credit Suisse said yesterday that it regretted falling short of MAS' and its own standards, while UOB said it accepted the MAS findings and will continue building on its anti-money laundering processes. Both will donate profits arising from the lapses to charity.
"The price of keeping our financial centre clean as it grows in size, and inter-connectedness, is unstinting vigilance," said Mr Menon.
On Monday, the regulator issued prohibition orders against three convicted former employees of Falcon Private Bank and BSI Bank.
Lifetime bans, which took effect on Monday, were slapped on former Falcon Singapore branch manager Jens Sturzenegger and former BSI banker Yak Yew Chee. A 15-year ban was also imposed on former BSI banker Yvonne Seah Yew Foong, now known as Seah Mei Ying.
MAS said it intends to impose prohibition orders on three others caught up in the scandal: former Maybank Kim Eng Securities remisier Kelvin Ang Wee Keng, NRA Capital chief executive Kevin Scully and NRA's former head of research Lee Chee Waiy.
The three were involved in the valuation of PetroSaudi Oil Services, which has been linked with 1MDB. Ang, who was convicted on one charge of bribing Mr Lee with $3,000 to speed up the preparation of a favourable valuation report, faces a six-year ban from providing capital markets and financial advisory services. He declined comment.
Mr Lee, on top of accepting the bribe, was found to have applied inappropriate methodology and assumptions in the valuation. He also faces a six-year ban.
Mr Scully faces a three-year ban because he failed to ensure that Mr Lee exercised sufficient care, judgment and objectivity in the valuation of the Saudi oil company. He told The Straits Times yesterday that he is seeking legal advice and declined to comment further.
