DBS and UBS Fined Over 1MDB Fund Flows

The Singapore regulator has imposed financial penalties on Singapore's largest bank DBS and on Zurich-based UBS. Both banks have also been told to appoint an independent party rectification measures.

The inspections of DBS and UBS in relation to their 1MDB-related fund flows uncovered several breaches of Anti Money Laundering (AML) requirements and control lapses, according to the Monetary Authority of Singapore (MAS).

There were deficiencies in the on-boarding of new accounts, weaknesses in corroborating the source of funds, inadequate scrutiny of customers’ transactions and activities, and failure to file timely suspicious transaction reports. finews.asia reported on the initial investigations earlier this year.

The MAS has imposed financial penalties amounting to S$1 million on DBS for 10 breaches and S$1.3 million on UBS for 13 breaches. The authority has also directed DBS and UBS to appoint an independent party to confirm that rectification measures have been effectively implemented and to report its findings to MAS.

Staff to be «Disciplined»

The control lapses observed in DBS and UBS relate to specific bank officers who failed to carry out their duties effectively. The Singapore Monetary Authority (MAS) inspections did not find pervasive control weaknesses within these banks.

UBS 510aMAS has admonished the two banks and instructed their management to investigate the lapses, promptly address the control deficiencies, and take appropriate disciplinary measures against the staff involved. The MAS has been working closely with the Swiss Financial Market Supervisory Authority (Finma) on the investigations. The announcement comes a day after two employees of BSI Bank in Singapore were charged with 1MDB related offences.   

A Clean and trusted Financial Centre

Standard Chartered Bank, Singapore Branch is still under investigation by the MAS who stated that they will make an announcement in due course. MAS has also referred the 1MDB-related transactions processed by Raffles Money Change to the Commercial Affairs Department for their follow-up investigation.

RaviMenon 510a«Keeping Singapore a clean and trusted financial centre is a shared responsibility. The board and senior management of each financial institution play a pivotal role. They must put in place robust mechanisms to detect suspicious activities, promote strong risk awareness among their staff, and empower their compliance and risk management people. They must set the tone from the top – that profits do not come before right conduct,» said Ravi Menon, (pictured left) Managing Director, MAS.

«MAS will work closely with the industry to ensure that standards are kept high and will take strong deterrent actions against institutions that fall short,» he added.





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