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In 1MDB-Related Probe, Penalties Slapped on Stanchart and Coutts by Singapore


12/02/2016


In 1MDB-Related Probe, Penalties Slapped on Stanchart and Coutts by Singapore
Due to money laundering breaches related to Malaysia's scandal-tainted 1MDB fund, the local units of U.K.-based Standard Chartered Bank and Coutts were imposed penalties by Singapore's central bank, it said on Friday.
 
The central bank have earlier this year ordered the closure of the local units of Swiss banks BSI and Falcon and the penalties - of S$5.2 million ($3.65 million)and S$2.4 million, respectively - were the latest punitive measures taken by the central bank in its crackdown on money laundering.
 
A prohibition order against Tim Leissner, Goldman Sachs' former Southeast Asia chairman, is also being processed by MAS.
 
The Monetary Authority of Singapore said that the inspection at Standard Chartered "revealed significant lapses in the bank's customer due diligence measures and controls for ongoing monitoring."
 
While the central bank did not find "wilful misconduct", it said that the 28 breaches were "serious".
 
It is taking action to strengthen controls and surveillance systems, Standard Chartered said in a statement.
 
"We regret that 1MDB-related transactions passed through Standard Chartered Bank Singapore accounts from 2010 to early 2013," the statement said.
 
"We reported the suspicious transactions, both before and at the time we exited the accounts in early 2013, and have been fully cooperating with the authorities investigating this matter."
 
The subject of money-laundering investigations in at least six countries, including Switzerland, Singapore and the United States is Malaysia's 1MDB, once a pet project of Prime Minister Najib Razak who chaired its advisory board.
 
24 breaches of AML requirements in relation to customer due diligence measures for politically exposed persons were revealed at Coutts, a private bank.
 
Yak Yew Chee and Yvonne Seah, who had left Coutts to join BSI Bank in late 2009 was among those officers who have since left the bank and whose actions or omissions resulted in this.
 
Coutts International is in the process of winding down its Singapore operations and was sold by Royal Bank of Scotland to Union Bancaire Privee in March 2015.
 
UBP does not inherit Coutts' "legal issues or liabilities" as the acquisition of Coutts International was an assets-only transaction, UBP said in a statement.
 
When Goldman Sachs was engaged by the fund to arrange three bond issues from 2012 to 2013, banker Leissner was responsible for managing the relationship with 1MDB. He had made false statements on behalf of his bank without its knowledge or consent, MAS's investigation found.
 
"Today's announcement refers to a matter we discovered in January of this year and identified as a clear violation of the firm's standards," Goldman Sachs said in a statement.
 
"At that time we promptly took steps to separate Leissner from the firm and reported the matter to regulatory authorities in several jurisdictions, including Singapore. We continue to cooperate with the MAS."
 
With relation to the management of any capital market services firm in Singapore, Leissner would be prohibited from performing any regulated activity under the Securities and Futures Act or taking part, directly or indirectly for a period of 10 years under the proposed order.
 
The central bank said it provide a final update early next year and was nearing the end of its 1MDB-related investigations.
 
(Source:www.reuters.com) 


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