Regulator Cuts Fine For Miscreant Bank Over 1MDB

Editorial Staff 23 October 2020

Regulator Cuts Fine For Miscreant Bank Over 1MDB

One of the banks embroiled in the Malaysia-centred scandal, and kicked out of Singapore as a result, had been forced to disgorge SFr95 million by the Swiss national regulator. That sum has been reduced.

Swiss regulator FINMA has cut the amount of money it is confiscating from the 1MDB.

Instead of paying SFr95 million ($104.7 million), as originally ordered, BSI - a business now acquired by Zurich-listed EFG International – will pay SFr70 million instead, FINMA announced yesterday.

“In making this reassessment, it considered those income and costs of the bank that were closely linked to the violations of supervisory law in business relationships in the context of 1MDB. FINMA has thus taken into account the new case law on the disgorgement of profits, including the Federal Administrative Court’s judgement of November 2019,” the regulator said on its website. 

BSI had contested FINMA’s decision over anti-money laundering failings in the 1MDB case from the year 2016 before the Federal Administrative Court. The latter confirmed the serious violations of supervisory law in its judgement of November 2019, but rejected one aspect of FINMA’s ruling: the calculation of the disgorgement of profits. Following the redetermination of the disgorgement of profits, this case is now closed, the watchdog said.

FINMA has also concluded all enforcement proceedings against individuals which were opened following the BSI case. 

In a separate statement, EFG International said: "As announced previously, EFG’s financial results will not be impacted by the modified disgorgement amount as the final purchase price for the BSI acquisition accounted for a respective provision, with the difference now being released for the benefit of the seller." 

Register for WealthBriefing today

Gain access to regular and exclusive research on the global wealth management sector along with the opportunity to attend industry events such as exclusive invites to Breakfast Briefings and Summits in the major wealth management centres and industry leading awards programmes